the high momentum rally in Cake price challenges a long-coming resistance of $1.95, will it surpass it?

PancakeSwap Price Prediction: Defying the current market consolidation, the Panckswap token price managed to sustain above the $2.1 level and prolong its recovery trend. Within a week, the coin price surged 57% to reach the current trading price of $3.37 and provided a decisive breakout from a falling wedge pattern. Here’s how this pattern could influence the near-term future of CAKE.

Also Read: Blockchain Expert Expects Historic Bitcoin ETF Approval By January 10

Is CAKE Rally Heading to $5.5?

• The formation of a wedge pattern hints at the exhaustion of bearish momentum and the start of a new recovery.
• A bullish crossover between the 100-and-200-day EMA would bolster buyers to prolong a bullish recovery
• The intraday trading volume in the Pancakeswap coin is $393 Million, indicating a 163% gain.

For over a year, the pancakeswap token price witnessed a steady downtrend under the influence of a falling wedge pattern. The converging trendline of the pattern acted as a major resistance and support and kept the downward trajectory in a confined range.

However, with the general bullish sentiment in the crypto market, the CAKE price found its bottom at $1.05 and initiated a new recovery. In the last ten weeks, the coin price has surged 258% to make a new year high of $3.79.

Amid this rally, the coin price breaks above the upper boundary of the wedge pattern, signaling an early sign of trend reversal. In ideal conditions, the CAKE price should rally to the highest peak of the wedge pattern, which is currently $5.5, indicating a 58% potential rise.

However, the rising price has hit a minor road at $3.5, which could trigger a temporary pullback before the next leap.

PancakeSwap Boosts CAKE Value with Weekly Burns

In a recent announcement by the PancakeSwap network, it was revealed that the team successfully executed the burning of 10.16 million CAKE tokens, valued at approximately $34 million, on December 26. This significant action has led to a decrease in the circulating supply of CAKE tokens, dropping from 275 million to 265 million. This development has surged CAKE Price to 18% and pushed its market cap value to $912 Million. The PancakeSwap team also disclosed that they plan to conduct these token burns on a weekly basis, continuing this practice until a decision is made to alter this approach. 

This decreasing supply aligned with the bullish technical outlook should maintain a strong recovery trend in CAKE price.

• Exponential Moving Average: The 20- and-50-day EMA can be used as viable support during the market corrections.
• Average Directional Index: The ADX slope at the 32% mark indicates the buyers may hit exhaustion soon and initiate a minor pullback.