The Internet Computer (ICP) token rose 9% in the past 24 hours as trading volume increased 93%, according to market data, extending gains amid a broader cryptocurrency market recovery.
The token retested a crucial supply zone as it rose from its seven-day low, placing it among the top altcoin gainers of the day. The price has traded at levels last seen in mid-February, although it has pulled back from its period high.
The gains reflect broader market sentiment, with Bitcoin (BTC) testing highs amid heightened risk appetite driven by Nvidia-related developments. Tokens associated with artificial intelligence narratives, including NEAR, Bittensor, and Render, also saw gains.
From a technical perspective, the retest of the key level marks a potential reversal point. A breakout of a long-term downtrend line appears to be developing, according to chart analysis. The Relative Strength Index on the daily chart indicates potential for further upward movement, while the Moving Average Convergence Divergence indicator shows signs of bullish momentum.
However, the price remains below key moving averages, with the 50-day and 100-day simple moving averages providing higher resistance. Support levels are at recent lows, according to technical analysts.
The price movement coincides with a recent tokenomics upgrade proposal from the DFINITY Foundation for the Internet computer network. The proposal aims to introduce revenue-funded token burns, with a portion of the cloud engine fees removed from circulation. The plan would implement usage-based node rewards, directly tying supply reduction to network demand.
Under the proposed model, most revenue from cloud engines would be allocated to node providers. The Internet computing network aims to move from fixed subsidies to performance-related incentives, a structure that resembles models used by other blockchain networks focused on cloud computing.