Recently, PancakeSwap’s [CAKE] resurgence encountered significant resistance around the $2 level, specifically near the 200-day EMA. Despite showing signs of improvement from its recent lows, CAKE is currently in a crucial position where a sustained breakout could provide bullish investors with a glimmer of hope.
Is CAKE poised to surpass the 200-day EMA barrier?
CAKE has been facing challenges in surpassing the 200-day EMA at $2.075, a strong resistance level since April. This EMA has persistently acted as a formidable barrier for over 7 months, promptly leading to selling pressure whenever CAKE attempted to breach it.
At the time of writing, CAKE was trading around $1.941, slightly above the 20-day EMA at $1.85 and the 50-day EMA at $1.843. These EMAs appeared closely aligned, forming a critical support zone. Despite some bullish momentum, the price stalled just below the $2.1 resistance level.
Traders are advised to monitor the $1.8 support level, where the 20-day and 50-day EMAs intersect. A decisive close below this level could trigger a downward trend towards $1.579, another significant support area. A bearish cross between the 20-day and 50-day EMAs might pave the way for CAKE to revisit the $1.8 support zone, potentially exposing it to the $1.5 support level.
The immediate resistance was identified at $2.071. A successful breakthrough above this level might set the stage for further resistance at $2.2 and possibly even $2.4.
With the RSI around 55 as of the latest update, indicating a retreat from the overbought region, it suggests a decline in buying strength over recent days. A potential bounce from the 50-mark could signal subdued sentiment, potentially leading to price consolidation around the EMAs.
Insights from CAKE Derivatives Data
The long/short ratio in the last 24 hours stood at 0.9324, indicating a slight inclination towards short positions. However, the long/short ratio for CAKE on Binance was notably higher at 2.12. Furthermore, there was a noticeable surge in CAKE’s trading volume, rising by 56.48% to reach $52.22 million – indicating heightened trader interest. Moreover, Open Interest saw a marginal increase of 0.51% to $16.5 million, suggesting traders maintain an optimistic outlook by keeping their positions active.
It is essential for traders to closely follow Bitcoin’s price movements, given the significant role broader market sentiment plays in shaping CAKE’s trajectory.