Falling RSI Could Trigger Double Top Pattern Fallout

The Pancake(CAKE) price resonates within $10 and $7.5 barriers for over a month now, creating a narrow range. However, the consolidation reflected a bearish set-up with double top pattern formation. Under the bearish RSI influence, the CAKE holders may lose the $7.5 mark.

Key points: 

• The CAKE reflects a 21.5% loss since last week
• The daily RSI divergence bolsters the double bottom fallout.
• The intraday trading volume in the CAKE token is $209.8 Million, indicating a 42% loss.

Source- Tradingview

On April 12th, the Pancake(Cake) price bounced from the $7.5 support, providing a higher low formation of an upcoming recovery.

However, the cake price failed to surpass the $10 resistance, undermined the possibility of a bull run, and reverted the coin price by 23%. The CAKE price revisited the $7.5 support, reflecting a double bottom pattern in the daily time frame chart. 

On April 28th, the cake buyers tried to rebound the price with a morning star candle pattern; However, with no follow-through observed, the possibility of a fallout remains on the cards. 

Respecting this bearish pattern, the coin price may drop below the $7.5 support and extend the ongoing correction. A daily-candle closing below this support would pull the altcoin back to march bottom support of $5.4.

In contrast, if buyers defend the $7.5 support, the CAKE price would continue to resonate in a minor range. 

Technical indicator

The declining EMAs(20, 50, 100, and 200) have started a lateral movement accentuating a range rally. However, the recent correction rally nosedived below these EMAs support puts sellers at an unfair advantage. 

Despite a lateral consolidation in price action, the RSI slope falling lower reflects the loss of bullish momentum. This bearish divergence gives additional confirmation for the double top pattern fallout

• Resistance levels- $10, $13.1
• Support levels- $7.6-7.1 and $5.4

From the past 5 years I working in Journalism. I follow the Blockchain & Cryptocurrency from last 3 years. I have written on a variety of different topics including fashion, beauty, entertainment, and finance. raech out to me at brian (at) coingape.com

The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.