PancakeSwap: As range extension persists, what’s next for CAKE?
CAKE short-sellers seek more ground amidst uncertainty after the U.S. debt rating downgrade by Fitch. When will bulls see respite?
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion
- CAKE has been range-bound since late June.
- Most investors distributed holdings amidst uncertainty.
Crypto markets posted mixed results in July amidst increasing uncertainty. Unfortunately, August looks no different if Fitch’s recent downgrade of the US debt rating is to be taken seriously. Like US equities, the crypto markets, especially altcoins like PancakeSwap [CAKE], posted short-term losses after Fitch’s move.
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The above development also cut short Bitcoin’s [BTC] recovery as it briefly forayed above $30k and slumped afterwards. If BTC sustains more uncertainty and selling pressure in the next few hours/days, a retest of the 2023 trendline support, near $28.3k, could be feasible.
Will bears breach the range-low?
CAKE’s lower timeframe price action has been neutral and range-bound throughout July. Price action oscillated between $1.45 and $1.63 over the same period.
At press time, short-sellers breached the mid-range of $1.53 and aimed at the range-low of $1.45 to lock in short-term gains. But they’ll have to clear the $1.50 hurdle to make the range-low target feasible.
To the south, the immediate support levels are the range-low of $1.45 and $1.40 support. Put differently, the $1.40 – $1.45 range was a crucial price zone for bulls looking for discounted prices.
But the price charts indicators weren’t inclined to buying options at the time of writing. The RSI was below the neutral level, reinforcing the sellers’ conviction. Moreover, the CMF wavered below the zero mark, denoting stagnated, below-average capital inflows for CAKE.
CAKE activity spiked in end-July
CAKE recorded increased user activity between the end of July and early August, as shown by spikes in active addresses (red). The spikes corresponded with upside price moves.
How much are 1,10,100 CAKEs worth today?
However, the 90-day Mean Coin Age recorded sharp drops, and it dropped lower. The inference was that recently accumulated CAKE tokens were easily moved, confirming sell pressure in July amidst range extensions.
Nevertheless, the overall weighted sentiment improved over the same period. But this could only be good news for bulls if BTC registers another strong upside move.
