PancakeSwap Price Prediction: CAKE Falls Below $2, Hits Two-Month Low, Bearish Momentum Intensifies

In the middle of this week, Pancake (CAKE) price continued to be under pressure, falling below $2 and hitting a two-month low, with sellers further strengthening their control over the market. Influenced by weak sentiment in the derivatives market and deteriorating technical momentum, this round of correction is intensifying, indicating that the price may fall further.

Bearish Derivatives Signals Indicate Increasing Downward Pressure.

Pancake's derivatives data supports a bearish outlook. Coinglass's open interest weighted funding rate shows that the number of traders betting on a further decline in CAKE price exceeds those expecting a price increase.

This indicator turned negative on Tuesday and is currently at -0.005%, indicating that bears are paying bulls. Historically, when the funding...rate has turned negative, CAKE price has dropped significantly.

CAKE funding rate chart. Source: Coinglass

The short-term downward trend is further supported by a decline in CAKE open interest on Binance exchange. On Wednesday, CAKE's open interest on Binance dropped to $14 million (UTC+8), close to the yearly low. The decrease in open interest indicates that traders are closing positions and speculative interest is waning, rather than new buying entering the market.

CAKE open interest chart. Source: Coinglass

Additionally, CAKE's long-short ratio was 0.92 on Wednesday (UTC+8). A ratio below 1 indicates rising bearish sentiment, as traders are betting on the asset's price to fall.

CAKE long-short ratio chart. Source: Coinglass

Pancake Price Prediction: CAKE Momentum Indicators Show Bearish Bias

On December 9, Pancake's price was blocked at the 50-day Exponential Moving Average (EMA) of $2.36 (UTC+8), and as of Tuesday had dropped 14%. This price level coincides with the descending trendline, forming a key resistance area. As of Wednesday, CAKE price had fallen more than 6% (UTC+8), hitting a new two-month low of $1.88 (UTC+8).

If CAKE continues to decline, its downtrend may extend to the October 10 low of $1.51 (UTC+8).

The Relative Strength Index (RSI) on the daily chart is 31, close to the oversold region, indicating strong downward momentum. In addition, the Moving Average Convergence Divergence (MACD) indicator formed a death cross on Sunday (UTC+8), and this death cross remains valid, further supporting the bearish outlook.

CAKE/USDT daily chart

On the other hand, if CAKE price rebounds, it may continue to rise and move towards the weekly resistance level of $2.13 (UTC+8).