Well, for those of you who don’t know anything about the CAKE cryptocurrency meant to add liquidity in the PancakeSwap. It is a decentralized automated market that allows users to exchange their crypto token holdings and even earn additional income by earning a fee in return. PancakeSwap worked on the Binance smart chain and was developed on the same blockchain network.
Pancakeswap uses permissionless liquidity pools that are controlled only using algorithms; there is no centralization authority. It works entirely automatically without the need for any market markers being an AMM. The story behind its naming is equally interesting as the name, which has derived its name from similarly named networks named after food items in the past. CAKE token as of now is worth around $4.6 billion with current value trading below $20.
Its BEP-20 token, PancakeSwap, is meant for rewarding and staking procedures. PancakeSwap ultimately offers faster transaction speeds, with lower gas fees than any other device project built on the costlier Ethereum network. The AMM offered by this decentralized exchange allows users to change their tokens against the liquidity pools. Here, users can even loan their token assets to the liquidity pools for earning digital token. These digital tokens can again be used to make even more profits.
PancakeSwap Price Analysis
Ideally, with such use cases and benefits, a cryptocurrency token should keep rising in value as more users onboard their network. But here we are witnessing a consolidative kind of movement with very less engagement from buyers. We have witnessed the rise and fall of this token to be working in tandem with the overall crypto sentiment.
CAKE token can be seen consolidation for a brief period with a resistance close to the $27 levels and support at $11. The unsure price action has added a distancing perspective for the buyers. With 200 DMA trading above the current value, the CAKE token will be facing stiff resistance to become trending again. The only positive aspect that can be derived from this price movement is the proximity of the currently traded value with the 200 DMA level.
The increase in popularity of the decentralized ecosystem will be adding more movement to this cryptocurrency. Still, such a movement might take a lot of time to revert on the chart of CAKE tokens. RSI, as of now, can be seen as an improvement showing more strength around 50 levels. Volumes for a longer duration have remained in the same zone, and hence, based on our PancakeSwap price prediction, one should expect them to stay at similar levels.