Monday, December 6

CAKE has been bullish since November: will it be time to break above $ 21?

PancakeSwap is one of the most widely used decentralized exchanges today, and also one with a high TVL. However, despite the fact that it has low and significant fees, this does not seem to be a sufficient reason to increase the prices on its token; not forgetting that they also burn during each transaction in the CAKE / BNB pair.

It should be noted that there are ample probabilities that in the long term we will see an upward movement in the CAKE token, but first an important resistance must be overcome, which is located at $ 21. At the time of writing the price of the digital asset is quoted $ 20.27 and registers a fall in the last 24 hours of 0.87%, and adds a gain in the last 7 days of 10.99% according to reports from CoinMarketCap.

Could the CAKE burnings drive it higher in the future?

The prices of the CAKE token have not made big changes despite the general uptrend of the market. This is because there is too much selling pressure from the bears. However, in the long term, the burning of tokens that takes place during each transaction can benefit the token.

In addition to this, there has been a notable increase in the use of PancakeSwap; fact that could cause an upward trend with the passing of the days; at the time of writing it has a trading volume of 2.6 billion in the last 24 hours; positioning itself in the TOP 3 of the DEXs with more volume.

In summary, we can say that since it is a deflationary asset that uses burning to increase its value, time will be an important factor to consider, since, as the days go by, they will burn more and this will increase their price in the market.

Short-term preview

In the short term, in the 4-hour period, we can see that an upward channel has formed that could definitely take CAKE above $ 21; level that has not been exceeded since September 20.

That is why it is very important to keep an eye on the sails at this time; as well as the RSI and ENV channels. Since, both suggest that the token is overbought at the moment, and we can conclude, that the bulls want to prolong the purchases.

CAKE analysis in 4-hour timeframe
CAKE analysis in 4 hours timeframe. Source: TradingView.

Bullish signals:

  • RSI is located at 60 points and with a bullish direction.
  • The bulls defended the middle margin of the ENV channel.

In addition to this, a high volume of purchases can be seen; fact that confirms the uptrend.

In summary, it is possible that the bulls extend short-term buying and the resistance located at $ 21 will be broken. However, we must pay attention to the RSI, since reaching an extreme level of bullish sentiment it is possible that we will see a correction in the price of CAKE.

The information in this content should be taken for informational purposes only, not intending under any point of view to urge the purchase / sale of financial assets.

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