Ever since PancakeSwap (CAKE) hit its all-time high back in May of 2021, the price of CAKE has been in a downtrend in the long-term chart. The price went as low as $2.37 in June of 2022, and it has been trying to recover ever since. Nonetheless, CAKE remains bearish in the long run, and it could continue like that judging by the price movement of Bitcoin (BTC).
However, CAKE has shown signs of improvement in recent weeks. Ever since the low of June of this year, the price has increased. The price of CAKE increased by around 100% in the following months, reaching as high as $5 in the last days of September. Recently, Cake has had another increase of around 8%, which was not enough to create a new high. However, the price of CAKE is at a crucial zone of support at around $4.45.
In this analysis, we will go through both technical and fundamental factors that could affect the price of CAKE in the coming days/weeks.
PancakeSwap (CAKE) Technical Analysis
When looking at the 1-day chart, we can notice an ascending wedge pattern created by the price movement of CAKE. This wedge is likely to lead to another breakout as it gets narrower, other things equal. Even though the recent high is lower than the previous one, the new low is similar to the previous one, indicating the strong support that CAKE can have at the $4.45 zone. Nonetheless, this could change at any moment if the trading volume increase.
The long-term chart also shows a wedge pattern, which could mean that there could be a shift in momentum in the price of CAKE. If CAKE attempts another increase in the coming days, we could see the price face resistance at around $5.
The Fibonacci retracement levels suggest that the recent retracement in the price of CAKE stopped at 61.8%. This zone of support was tested twice, which could mean that the buying pressure is still high for CAKE. Other things equal, CAKE could aim for $5.50 in the coming days if the momentum continues.
Indicators
The fear and greed index still shows signs of fear in the long-term chart of CAKE. As for the short run, there are signs of greed in the price of CAKE. Nonetheless, CAKE remains highly volatile, and the FUD throughout the crypto market remains high.
When CAKE hit $5 last week, the RSI of the 1-day chart reached above 70 momentarily. Hence, the price declined and is now within the 30-70 range. Hence, the price could literally go both ways easily as there is plenty of space for growth, but at the same time, the selling pressure is on the rise.
The MACD line of a 1-day chart is currently below the signal line and heading below the baseline. This indicates that the momentum is bearish for CAKE in the short run. Hence, we could see the price of CAKE decline if support at $4.45 is broken.
PancakeSwap (CAKE) Fundamental Analysis
The recent increase in the price of CAKE mainly comes from the recent cIFO – Community Initial Farm Offering. The cIFO allows long-term CAKE hodlers to have early access investment in new projects. Not only that this cIFO increases the engagement of the CAKE community with the PancakeSwap ecosystem, but it also increases the demand for CAKE tokens. The number of social media mentions of PancakeSwap increased by around 100% in the last few days, suggesting the impact that the cIFO has had on the crypto community.
Because of that, the price of CAKE has recently increased while the majority of the market remains bearish.
👉 Join the upcoming IFO: https://t.co/GbmwKt0w1s
— PancakeSwap 🥞 #BSC (@PancakeSwap) October 7, 2022
On the downside, however, the recent PancakeSwap NFTs failed to accumulate enough funds, which significantly shows the falling interest in NFTs among crypto enthusiasts. Because of the failed sales, the price of CAKE has started to retrace, and it could aim further down if key support structures are broken.
Here is how the NFT trading volume has declined for PancakeSwap in recent days:
CAKE Price Prediction
Based on this analysis of PancakeSwap (CAKE), the price of CAKE could decline in the coming days if support at $4.45 is broken. Other things equal, the price could decline below $4 in the coming days.
Nonetheless, if support proves strong once again, CAKE could aim higher given the recent increase in community engagement as well as technical indicators suggesting a potential breakout. If the momentum recovers for CAKE, the price could aim for $10 in the coming weeks, ceteris paribus.
Takeaways
- PancakeSwap (CAKE) increased recently due to the recent cIFO.
- Technical indicators suggest that the price could decline in the short run.
- PancakeSwap community engagement has increased recently.
- CAKE could go below $4 in the short run.
- CAKE has the potential to aim for $10 in the coming weeks/months.