PancakeSwap Shows Consolidation; What Does Future Hold for CAKE?
CAKE token is more of an exchange token also used for governance purposes. The ranking of #76 position is merely based on its in-circulation supply of CAKE tokens, which is 19% of its total supply. PancakeSwap has a total value locked (TVL) of $3,088,813,752, but the market cap is limited to just $532,308,510. PancakeSwap is similar to Uniswap, which is part of the decentralized exchange platforms that enable swift change in token assets without delay. CAKE helps its ecosystem extract the best value from different exchanges based on its liquidity pool.
PancakeSwap supports the exchange of BEP-20 tokens, earns fees for providing liquidity to their pools, and even staking can be used to earn more CAKE tokens and exchange them with other BEP-20 tokens. The primary concept is liquidity which allows them to address the changes in demand of buyers and sellers. Major factors affecting the growth of the DEX economy are better execution and a network of centralized exchanges, which offer a host of features, support, and benefits to the actual user.
CAKE token hasn’t even reached the halfway mark of the June 2022 resistances and has been moving in consolidation, followed by further downside movement. Technicals signify a decline in buying action that would be trapping the prices under a tight consolidation for a longer time frame. Get detailed information about the same by clicking here!
CAKE token is facing stiff consolidation with no sudden upside movement witnessed in the last three months. With price action slowly moving closer to the 100 EMA curve, there is a minor possibility of a breakout. This price action will be further tested at the resistance of $5.1 on the short-term time scale.
RSI during the current phase touched the overbought zones without significant buying in July 2022. The profit booking stance was initiated after a significant gain, which will keep the CAKE token under pressure. The upper wicks formed on the recent candles indicate profit booking sentiment getting stronger, with the bearish engulfing candle of August 2 confirming sellers in control.
MACD indicator showcases the continuation of the bull run, and the rising wick on the lower-end current candle shows the buyer’s attempt to contribute toward a positive sentiment. Transactional volumes of PancakeSwap should not be considered a technical indicator as this token is multifaceted with limited liquidity, allowing for a rise in volume.
Weekly charts show a loss in volatility each week since the crash in May 2022, and such momentum would require a tremendous push to reach its all-time high of $44.18. The price of PancakeSwap is still trading at a negative of 91.54% compared to its peak valuation.