Story (IP) Overcomes Market Recession With 4% Gain – What’s Next?

The Layer-1 (L1) Coin IP has emerged as the strongest price-increasing coin in the market today, despite the overall cryptocurrency market decline, recording a 4% increase in the past 24 hours.

However, despite the price increase, warning signs are appearing. On-chain activity remains quiet, suggesting that this price surge may not be supported by strong fundamental factors.

Traders bet against PI despite price increase

While most cryptocurrencies are trading lower, PI has gone against the trend to record an increase. However, this price surge may not last, with on-chain indicators showing increasing skepticism among traders.

For example, while increasing 4% in the past day, IP's daily trading volume has dropped 38%, indicating low participation supporting this price movement.

When an asset's price increases while trading volume decreases, it suggests fewer participants are driving price volatility. This indicates weak buying momentum or lack of broad market support for IP's price surge.

Such conditions make the coin's price increase unsustainable, increasing the risk of reversal or correction.

Moreover, IP's funding rate remains negative, reflecting that many futures market traders are placing short-term bets – predicting price will drop. At the time of writing, this rate was -0.14%.

The funding rate is a periodic fee paid between traders in the perpetual futures market to keep the contract price aligned with the spot price. When the funding rate is negative, short-term traders pay long-term traders, indicating that most of the market is betting on price decline.

In IP's case, the negative funding rate suggests many traders predict a reversal of the recent price surge. This reflects continuous downward pressure that has kept the coin's performance constrained in recent weeks.

Can IP recover? Token aims for $3.17 if demand returns

At the time of writing, IP is trading at $2.75, hovering above the critical support level at $1.59. If demand weakens, IP risks falling below this level and could drop under $1.

However, a recovery in new demand for altcoins could nullify this downward prospect. In that scenario, IP's price could recover to $3.17. A successful breakout above this resistance level could push the IP token price to $4.41.