The Internet Computer (ICP) token is showing signs of a potential bullish reversal after breaking out of a long-term descending trendline that had been holding it down for months. This breakout has opened the door for a possible rally toward the $10 level in the coming weeks.
On Wednesday, ICP shot up nearly 70%, reaching an intraday high of $6.32 before settling near $5.14 at press time still about 76% higher than its monthly low. Despite the strong rebound, the token remains 58% below its yearly high of $12.32.
AI Platform Upgrade Fuels Renewed Interest
The surge came after the Dfinity Foundation, the Swiss-based non-profit behind Internet Computer, announced the expanded public release of its AI platform “Caffeine” on November 4.
Previously limited to text input, Caffeine now supports image and code prompts, unlocking multi-modal functionality and giving developers the tools to build decentralized AI applications from scratch.
This major upgrade immediately boosted market sentiment and trading activity. According to CoinGecko, ICP’s 24-hour trading volume jumped 170%, while data from CoinGlass showed futures open interest rising 10% to $137.76 million and futures volume up 126% to $2.68 billion. These figures indicate that short-term traders rushed in to capitalize on the sudden momentum.
On-Chain Metrics Point to Strengthening Fundamentals
Beyond speculative activity, the fundamentals behind the Internet Computer ecosystem are improving as well. Data from DeFiLlama shows that the total value locked (TVL) in ICP-based DeFi protocols rose 22.5% in the past 24 hours to $37.9 million. Similarly, the market cap of stablecoins on the network increased 13.5% over the past week to $4.5 million.
These numbers suggest that investor confidence in the network’s real-world utility is growing, reinforcing the bullish technical setup.
Technical Outlook: Breakout Opens Path Toward $10
Technically, ICP has now broken above a descending trendline that has capped upside moves since December 2024. This breakout marks a potential end to the multi-month downtrend and could set the stage for a stronger upward phase.
Other indicators also point to growing bullish momentum. The MACD lines are widening positively, and the RSI has turned upward, signaling improving buying strength.
If this momentum continues, ICP’s next major target lies between $10 and $11 a zone that served as major resistance several times last year. A decisive move above that range could confirm a multi-year falling wedge breakout, often seen as a powerful bullish reversal pattern.
On the downside, $5 remains the key support level. Losing that floor could trigger a retest of the $2.80 base, where ICP previously found strong accumulation.
Internet Computer’s breakout and surging metrics signal renewed optimism among traders and developers alike. If momentum holds and Caffeine adoption expands, ICP could continue climbing toward the $10 mark in the near term.
