Internet Computer [ICP] has been stagnant since mid-June with the price action trading around $2.17. The 9-day and 26-day moving averages are flat, reinforcing this quiet price action with an insignificant daily change.
Interestingly, the price action of ICP is hinting at a potential breakout that could determine the altcoin’s direction.
ICP crypto nears triangle pattern breakout
Looking at the price of ICP, the altcoin was trading at the apex of a triangle consolidation pattern. The pattern is characterized by a horizontal support at $2.12 and a slanting resistance running from $2.50 to $2.20. It has lasted for about two months.
The price contraction to the apex indicates volatility is low. Usually, low volatility precedes high volatility, which hints at a potential pattern breakout.
For now, ICP is trading in a consolidation. However, breaking and staying above the slanting resistance would expose a rally toward $2.50 or higher.
This was backed by Bull Bear Power (BBP) turning bullish. Additionally, transactions of more than 10K ICP on the Binance spot market have been increasing since the 15th of July.
Collectively, over 503 million ICP tokens had been aggressively accumulated in these two weeks. But from a broader perspective, ICP’s buying activity started in the second half of June.
On the other hand, if ICP breaks below the support at $2.12, more price decline may be expected. That is, the next key demand level is at $2, while the extreme bear target is at the $1-$1.16 zone, which was created on the 10th of October.
Why is network activity showing divergence?
While ICP was bullish on the technical outlook, its chain activity was bearish. For instance, overall transactions fell from 9,612 per day to about 3,680, the lowest level this month. These figures represented about a 62% drop in network usage.
However, ICP topped blockchains by monthly transaction count with 9.40 billion, as Solana [SOL] followed with 8.60 billion.
Similarly, volume was tanking further, creating this month’s low. It tumbled from 2.869 million ICP to 362.7K ICP tokens, further reinforcing the low network activity.
Final Summary
- Internet Computer was trading at the apex of a consolidation pattern as the accumulation trend gained pace.
- ICP’s on-chain activity was diverging from the bullish technical outlook, reinforcing that a potential breakout was looming.
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