PancakeSwap’s (CAKE) Bearish Pattern Forecasts A Price Drop Of 75%
The price of PancakeSwap's native token, CAKE, is moving inside a bearish pattern. The token is struggling to move above its EMA resistance. The post PancakeSwap’s (CAKE) Bearish Pattern Forecasts A Price Drop Of 75% appeared first on CoinChapter.
Key Takeaways:
- The price of PancakeSwap’s native token, CAKE, is moving inside a bearish pattern.
- The token is struggling to move above its EMA resistance.
NEW DELHI (CoinChapter.com) — Decentralized exchange PancakeSwap’s native token CAKE is moving inside a bearish technical pattern called the bear flag.
The pattern forms when a cryptocurrency’s prices chart a sharp countertrend (the flag) after a short-lived trend. Flag patterns usually indicate a reversal of the countertrend. In addition, in a bearish pattern, volume might not always decline during consolidation.
Since an uptrend marks the consolidation period after a sharp downtrend, investors move in due to FUD from the price fall. Hence, higher-than-average volumes often accompany the consolidation period.
Traders calculate the bear flag pattern’s price target by subtracting the flagpole’s length from the breakout price level. Hence, per the rules of technical analysis, CAKE’s price might drop more than 75% and reach $0.913 if it confirms the pattern.
PancakeSwap Price Struggling Against EMA Resistance
CAKE’s price lacked vigor on April 4, rising only 1.3% to a daily high near $3.72. Meanwhile, the PancakeSwap token has struggled to break above a dynamic resistance confluence of its 20-day EMA (red wave), 50-day EMA (purple wave), and 100-day EMA (blue wave).
After the 200-day EMA (green wave) rebuffed the CAKE price rally in Feb earlier this year, the PancakeSwap token broke below its 20-day EMA. Furthermore, in March, CAKE price struggled to conquer the $4 resistance.
The momentum oscillator MACD forecasts bearish times for the PancakeSwap token. The MACD line and the MACD signal line might form a bearish crossover, which occurs when the MACD line (difference of 12-day and 26-day EMA) moves below the MACD signal line (9-day EMA of MACD).
Also Read: Elon Musk Pumps Dogecoin 30% in a Day AGAIN – DOGE Reversal Ahead?
Forming a bearish crossover might force the CAKE price to drop to $3.6. Conversely, breaching the immediate support level could give bears the leverage to push the PancakeSwap token to $3.44 before recovering.
On the other hand, if bulls enter the market, CAKE’s price might break above the 20-day EMA to target the 50-day EMA resistance near $3.8. Moreover, a break and hold above immediate resistance would likely invite interest in the token, helping CAKE price target resistance near $4 before retreating.
PancakeSwap Launches Version 3
PancakeSwap launched version 3 of its platform on April 3.
The upgrade would make PancakeSwap one of the cheapest DEX among competitors regarding trading fees. PancakeSwap V3 reduced its trading fees by 25x from version 2 and introduced four trading fee tiers (0.01%, 0.05%, 0.25%, and 1%).
Token pairs would have a liquidity pool for each fee tier, choosing the tier that best incentivizes liquidity providers and traders. The platform would allow liquidity providers to concentrate their capital on smaller price intervals.
Additionally, PancakeSwap V3 plans to launch a VIP trading rewards program and a built-in limit order soon.
The post PancakeSwap’s (CAKE) Bearish Pattern Forecasts A Price Drop Of 75% appeared first on CoinChapter.
