Internet Computer (ICP) rises amid market downturn, driven by short squeeze AI hype. The Internet Computer ecosystem growth and AI tools have strengthened investor confidence. A breakout above the key resistance at $5.94 could push ICP’s price toward $7.

Internet Computer (ICP) has caught the attention of crypto traders and analysts alike by defying the broader market downturn.

While Bitcoin (BTC) and Ethereum (ETH) struggle with declining prices, ICP has surged by double digits, showcasing resilience.

Notably, the ICP’s price surge comes amid growing ecosystem developments and increasing activity in the AI space, signalling that the network is finding new momentum even in a challenging market environment.

Over the past 24 hours, Internet Computer (ICP) has risen sharply, trading around $5.44, after an 11.3% increase despite a broader market downturn that has weighed heavily on most major cryptocurrencies.

This surge has been fueled in part by a potential short squeeze, as funding rates in the derivatives market have turned deeply negative.

Traders holding short positions on ICP faced growing pressure as the token’s price climbed, forcing some to close their positions and buy back the token, which added upward momentum.

However, open interest in ICP derivatives has surged nearly 92% to $174 million, indicating heightened trading activity and volatility that could accelerate the rally further if key resistance levels are overcome.

The technical picture for ICP is equally compelling.

The token recently broke above a two-month falling price channel, a pattern that had contained the asset since early November.

This breakout is considered a bullish signal, with indicators like the Awesome Oscillator turning positive.

While the MACD remains bearish and the RSI hovers near neutral at 52, the price move suggests that sellers’ control is weakening.

Beyond technical catalysts, the Internet Computer (ICP) price is also supported by strong ecosystem fundamentals.

The total value locked (TVL) in ICP’s DeFi ecosystem has grown 57% in the past month to reach $19.83 million, driven by platforms such as WaterNeuron, which alone has seen its assets increase by 90%.

Stablecoins on the network have also risen, now totalling nearly $4.93 million.

Additionally, the launch of Caffeine, a platform that allows users to build websites and applications through AI without coding, has reinforced ICP’s position in the fast-growing AI sector.

Institutional partnerships and integrations, including collaborations with Microsoft Azure and Google Cloud, have further strengthened the network’s decentralised cloud and AI narrative, attracting developers and investors alike.

While the broader market faces uncertainty, ICP’s ecosystem expansion, AI integration, and strong technical setup position it for further upside potential.

The combination of technical and fundamental drivers suggests that the Internet Computer (ICP) price could continue its upward trajectory.

A successful breakout above the $5.94 resistance could open the path to $7 or higher, with strong buying momentum reinforced by the short squeeze dynamic.

At the same time, holding the key support level at $4.76 will be critical to maintaining investor confidence.

If bulls remain in control, traders should closely watch the $5.94 resistance, with a daily close above this level potentially confirming a trend reversal and opening the door to higher targets near $6.74 or even $7.32, in line with Fibonacci retracement levels.

The post Internet Computer (ICP) breaks out of a falling wedge pattern, $7 within reach appeared first on CoinJournal.

187 +