ICP price rises 16% after listing on Upbit, but underlying weaknesses could reverse this upward trend

Today, Internet Computer (ICP) experienced a remarkable surge, increasing by 16.7% immediately after the announcement of being listed on a major exchange. This move quickly drew the attention of investors in the market.

However, beneath this rally, signs of skepticism have begun to emerge. Initial technical signals suggest that the current upward momentum may be difficult to sustain without strong support from fundamental factors.

ICP Investors Rush to Sell, Accepting Losses

As ICP’s price surged sharply, many investors’ first reaction was to sell quickly. While taking profits during a rally is common, today’s trading activity raised some concerns. According to statistics, approximately $7.86 million worth of ICP trades were executed with profits during the day.

More notably, the value of losing trades reached $10.23 million. This indicates that a large number of investors sold at lower prices than their initial purchase, reflecting panic and panic selling behavior rather than strategic profit-taking. This action adds downward pressure, potentially weakening the growth momentum brought by the listing announcement on Upbit.

Distribution of ICP Trading Volume | Source: SantimentNot stopping there, ICP’s derivatives market also showed a negative trend immediately after the rally. Many traders hurried to open short positions as the price increased, causing the funding rate to fall into negative territory. Negative funding rates indicate that traders holding short positions are paying a premium, reflecting a common expectation that the price will soon correct downward.

Derivatives Market Pressure Could Limit the Uptrend

The downward trend in the derivatives market could create a self-reinforcing cycle. As short positions increase, selling pressure on the market also rises, limiting the potential for further price increases. If ICP cannot hold above key support levels, negative sentiment in the derivatives market could accelerate the decline.

ICP Funding Rate | Source: Coinglass## ICP Faces Reversal Risks

Currently, ICP is trading at $2.78, maintaining above the important support level of $2.74 after a 16.7% increase following the Upbit listing announcement. This rally helped the cryptocurrency break above the 50-day exponential moving average (EMA), a positive technical signal. Previously, the price rebounded from the support level of $2.36, establishing a short-term recovery structure.

However, despite these positive signals, the previously mentioned negative factors pose a significant challenge for ICP to break through the resistance at $2.88. If it fails to sustain the rally and surpass this level, the price could reverse and drop to $2.56, losing a substantial portion of the gains made during the day. Panic selling and negative funding rates are creating an unfavorable environment for maintaining the upward trend.

ICP Price Analysis | Source: TradingViewNevertheless, hope remains if investor sentiment shifts positively. If buyers can regain control and successfully defend the $2.74 support level, ICP will have the opportunity to challenge the resistance at $2.88. Breaking through this level could push the price to $3.10, invalidating bearish signals and confirming that the Upbit listing will have a long-term positive impact on the coin’s value.