Journalist
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Key Takeaways
Is PancakeSwap trading within a range?
Since January, CAKE has been trading within a range, and attempted breakouts, such as in late July, have not been successful.
Could the current breakout be another such failure?
If market sentiment shifts bearishly over the next week, and selling pressure on BTC and major altcoins prevail, it could send CAKE back below the $2.88 liquidity cluster.
PancakeSwap [CAKE] had a good start to the weekend. It posted a 13.34% rally on the 20th of September. However, the bulls might not be able to keep the gains, as Sunday’s trading showed.
At the time of writing, CAKE was down 2.8%, from $3.068 to $2.982.
The technical indicators were bullish, but unless the $2.91-$2.95 zone is flipped to support, next week’s trading might begin bearishly for PancakeSwap on Monday.
The CAKE range breakout – will it be successful?
Source: CAKE/USDT on TradingView
Since January, CAKE has traded within a range that reached from $1.37 to $2.94. The recent breakout saw the prices push above the range highs, but this resembled the late July bullish breakout.
That breakout had been a failure, and the price sank to $2.4 in the weeks that followed.
This is why the $2.91-$2.95 area is pivotal for the next uptrend. The CMF was at +0.18, and the A/D indicator saw a slight uptick in recent days. They signaled increased demand and capital inflows to the market.
The Awesome Oscillator formed a bullish crossover as well.
Source: CAKE/USDT on TradingView
Zooming in to the 4-hour chart, the Fixed Range Volume Profile highlighted the $2.92 level as the Value Area High, a critical S/R level.
If the price can stay above this level, its chances of establishing an uptrend would be strengthened.
However, the A/D indicator saw a dip, and the CMF was at -0.06 to highlight heavy selling pressure on the 4-hour timeframe. This might be enough to force CAKE back within the confines of the range.
Additionally, the liquidation heatmap highlighted the $2.88 level as a magnetic zone for CAKE prices. Over the next few days, it was highly probable that CAKE would fall to $2.88.
Whether the bears can take it lower, or if the bulls can enforce a recovery, would depend on market sentiment and the strength of demand for PancakeSwap tokens.
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion
