Few coins may be riding on the market’s risk-on rotation, and Internet Computer [ICP] seems to be showing similar signs.
In mid-August, strong capital inflows pushed Bitcoin above $75k, with most altcoins following higher. Some performed even better than BTC, with XRP/BTC rallying over 20%, signaling clear rotation into XRP.
This suggests that the outlook for ICP is not as bullish as some may think. As the chart below shows, ICP rallied a modest 7.56% during the same period, underperforming most of the altcoin market and providing little evidence of a strong bullish trend.
The key takeaway? ICP is showing clear weakness on a relative basis.
On the rotational front, the ICP/BTC ratio dropped 11.4% between the 17th and the 23rd of August, its largest weekly decline in over two months. By contrast, the XRP/BTC ratio jumped 23% in the same period. What it means is that while capital was rotating into XRP, ICP was lagging behind BTC.
Combined with the weakness on an absolute basis, ICP’s weakness on a relative basis also suggests a bearish bias. The weakness puts its ongoing $2-$3 consolidation in a weaker light, making the range look more like a period of continued weakness than a strong base.
Notably, a recent report adds to this setup, ranking Internet Computer [ICP] as the biggest loser among 60 major cryptocurrencies.
ICP’s 99%+ drawdown fuels bearish case
ICP’s already weak price action gets another blow, as per a recent Taurex report.
The report compared the all-time highs (ATH) and current value of 60 cryptocurrencies to determine which ones underperformed the most. As per the findings, ICP recorded the largest drawdown from ATH at 99.69%, being significantly ahead of the pack.
One analyst told AMBCrypto:
Internet Computer has lost over 99% of the value from its ATH price of $700, and now it trades at just over $2. It means that almost every investor who bought the tokens at the peak has suffered significant losses.
Moreover,
ICP peaked in May 2021, during the last bull run, and has been constantly dropping since then. In fact, right now, Internet Computer’s market value is only 1.2 billion, which is substantially lower than its highest peak, making it the biggest loser among the rest according to our research.
In this context, the recent price action of ICP does not seem to inspire much FOMO.
In particular, during the altcoin season of mid-August, ICP only managed to increase by 7.56%, relatively lower than most of its counterparts. During the same period, the ratio of ICP/BTC decreased by 11.4% to reach the lowest weekly close since May. On the contrary, XRP/BTC rose by 23%.
Thus, with ICP’s overall low performance and consistent underperformance versus Bitcoin [BTC], the bearish setup remains intact. This puts the $2 level at risk, with a break below it exposing ICP to further downside.
Final Summary
- Internet Computer is lagging the broader altcoin rally, gaining just 7.56% while the ICP/BTC ratio fell 11.4%, signaling weak relative strength.
- The bearish setup remains intact, with the altcoin down 99.69% from its ATH and its $2-$3 range now facing pressure, putting $2 support at risk.
