COMP at a Crucial Crossroads – Is a Plunge to $23 Inevitable?

Market sentiment for Internet Computer (COMP) remains bearish as the asset has seen declines of 12.31% over the past week and 24.92% over the past month. As of March 17, 2025, COMP is trading at a critical support level, and if this level fails, analysts predict a significant further decline.

COMP has been trading at the bottom of a consolidation channel since July 2023. If the current support level fails, it may initiate a bearish flag pattern, characterized by a sharp decline followed by consolidation and then further downward movement. The next support level is at $23.27, which indicates a potential 50% decline if breached. Should this support fail, COMP could drop below the $20 mark.

Recent data from the derivatives market shows a high likelihood of COMP dropping below this key support. Open interest has decreased by 1.83% to $18.08 million in the last 24 hours, accompanied by a Taker Buy Sell Ratio of 0.9242, indicating that selling volume is outpacing buying volume. Additionally, the Funding Rate is currently negative at -0.0065, suggesting a market trend favoring sellers.

In the spot market, traders have begun selling COMP for the first time since early March, reversing the previous trend of accumulation. The daily exchange netflow is positive, indicating increased selling activity, with approximately $71,000 worth of COMP sold recently. If this trend continues, compounded with bearish sentiment in the derivatives market, a significant price drop for COMP is anticipated.

In summary, COMP is at a critical juncture, with bearish market indicators suggesting a potential decline below $23. The combination of declining open interest, negative funding rates, and increased selling activity points to a challenging outlook for the asset in the near term.