Although the Internet Computer (ICP) dropped to a new all-time low on Feb 22, it has bounced slightly and is showing the first signs of a potential bullish reversal.
The ICP has been falling alongside a descending resistance line since hitting a high of $87 on Sept. So far, it has declined by 79%, leading to a new all-time low of $16.81 on Feb.
The dip also caused a collapse at the $29 horizontal support area.
The ICP has bounced a bit since then and could soon make an attempt to break out of the descending resistance line. In this case, the $29 area is now expected to provide resistance.
Has the ICP reached a bottom?
Cryptocurrency Trader @PrinceofElliott tweeted an ICP chart, stating that the price could soon hit a long-term bottom and start a significant upward move.
The daily chart shows signs of a possible trend reversal, visible in the form of a very significant bullish divergence (green lines) on both the MACD and RSI.
Such pronounced divergences often precede uptrend reversals. Therefore, they suggest that an eventual breakout of the resistance line is expected.
If the $32 area rebounds, the next resistance will be at $58. This is a horizontal resistance area and coincides with the 0.618 Fib retracement resistance level when measuring the entire dip.
Wave count analysis
The wave count suggests that the ICP has completed a five-wave downward move or is very close to doing so. Wave five has taken the form of a final diagonal, implying that the subsequent reversal is likely to be fast.
Boost also has compatible Fib ratios. Wave five is 0.618 the length of wave three (black), while wave one is the length of the other two waves combined as it is the one that extends.
As a result of the confluence of all these factors, it is possible that the ICP has reached a bottom or will do so in the very near future.
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