CAKE Technical Analysis: Bears Takedown The Year-Long Support of $10

PancakeSwap can be described as an automatic market maker (AMM) -A decentralized finance (DeFi) application that allows users to trade tokens for liquidity through farming and earning fees for the exchange.

PancakeSwap lets users exchange BEP20 tokens, supply liquidity to exchanges, and receive fees. You can stake tokens of LP to earn the CAKE token and stake the token in order to make more money.

Past Performance of CAKE

The CAKE coin price action shows a downfall of more than 40% in the past ten days from $12. The downfall takes support at $7but breaks below the annual support level of $10. The breakout marks a bearish milestone as the support level had pushed the price higher multiple times in 2021. However, the bearish takedown increases the selling pressure and breaks the bullish morale.

 

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CAKE Technical Analysis

The CAKE coin price action forms multiple bearish engulfing candlesticks in the daily chart. Moreover, the long wick formations in the daily candles reflect higher price rejection.

The crucial Exponential Moving Averages (50, 100, and 200) maintain a bearish alignment from December 2021. The 50-day EMA provides constant dynamic resistance to any bullish attempts in the correction phase.

The MACD Indicator shows a sudden fall in the fast line after the recent bearish crossover below the zero line. Moreover, the increasing intensity of the bearish histograms reflects a rise in selling pressure.

The DMI Indicator shows a sharp rise in the ADX slope as it approaches 30%, reflecting a rise in the trend momentum. The DI lines indicate a downtrend in action because of a bearish alignment and a significant gap.

Therefore, the technical indicators and the price action indicate a solid downtrend in action. That is why traders can shortly find the CAKE prices breaching below the freshly formed low at $7.

Upcoming Trend

The CAKE coin price breaks below the long-coming crucial horizontal support level at $10, which was in action from the start of 2021. PancakeSwap faces extreme selling pressure and can shortly breach $7.

Therefore, sellers can target the level of $6.15 and $5 below the $7 mark. However, in the unlikely case of a reversal, the resistance levels at $9.5 and $11.

At press time, the CAKE Technical Analysis widget by TradingView gives a “SELL” sign for the token.

 

Disclaimer: These are the writer’s opinions and should not be considered investment advice. Readers should do their own research.

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