CAKE, the native token of PancakeSwap, is currently drawing attention from traders as it forms what appears to be a classic accumulation pattern on the daily and 4-hour chart.
General view on the chart š
About CAKE (PancakeSwap Token)
CAKE is a BEP-20 token powering PancakeSwap, one of the most active decentralized exchanges on the $BNB BNB Chain. It has multiple utilities:
ā¢ Staking for rewards via Syrup Pools
ā¢ Yield farming
ā¢ Governance voting on proposals
In 2023 and beyond, the PancakeSwap team shifted CAKEās tokenomics towards sustainability, including reduced emissions and a vision of eventual deflationary supply. This has set the stage for a potentially stronger long-term value proposition.
Technical Analysis: 4H Timeframe
The 4H chart reveals an interesting double-bottom setup, often seen at the end of downtrends. The price is currently hovering around $2.05, with a potential dip forecasted into strong demand zones before any rally.
Identified Demand Zones
Key Demand Zone to Watch: $1.40 ā $1.57
The chart highlights a critical demand zone between $1.40 and $1.57, where buyers have previously stepped in. This area has served as a base for bullish reactions in the past, and traders should closely monitor price behavior if CAKE returns to this range.
ā¢ A bounce within this zone could signal renewed bullish momentum and the start of a reversal.
ā¢ However, a clean break below $1.40 may invalidate the bullish setup and open the door for further downside.
Projected Price Movement
Based on the structure and what i see:
1. Dip to Demand Zone: Price may drop to test the $1.4000-1.5700$ region.
2. Initial Rebound: A bounce from this level could push CAKE back toward $2.05ā$2.20.
3. Higher Low Formation: A minor retracement could follow, forming the second leg of the āWā pattern Just as shown on my screen
4. Breakout & Rally: If this pattern completes, the next targets are $2.586 and $2.761āboth of which are key resistance zones from past price action.
Trade Considerations
ā¢ Entry Area: $1.4700ā$1.5700 (upon confirmation with bullish structure or candle signals)
ā¢ Take Profit Levels:
ā¢ TP1: $2.05
ā¢ TP2: $2.58
ā¢ TP3: $2.76
Buy $CAKE here on spot not futures ā¬ļøā¬ļøā¬ļø
Disclaimer:
I am only sharing my personal analysis and perspective. This is not financial advice. Always do your own research and follow your own strategy.