The Mysterious Case of CAKE’s Rejection: A Sweet Buy or a Sour Trap?

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  • Looks like PancakeSwap had a sugar rush, pushing towards the sweet $3 mark
  • Liquidity zones from $2.7 to $2.3 might be pulling prices down to the depths

Well, well, well, PancakeSwap [CAKE] is having a bit of an identity crisis. It’s bouncing around the highs of its five-month range—just testing the limits, I suppose. The range itself? Oh, it’s a thrilling ride from $1.37 to $2.95, with a comfy mid-range spot at $2.16. Not bad, right?

But, as always, just when things were looking peachy at $2.95, CAKE got a bit of a reality check. It was like the price said, “Hey, I’ve had enough of this. Time to take a nap,” shedding 5.6% of its value in a mere 11 hours after a glorious 22% rally over six hours. Talk about a rollercoaster!

Is this a normal tantrum? Maybe. It could very well be a liquidity hunt—a classic CAKE move. Our friends at AMBCrypto went on an investigative spree, checking out the liquidation heatmaps. They found that the 1-day chart is not for the faint of heart, suggesting that CAKE traders might want to hold off on any overly enthusiastic high-fives near the top of the range.

Now, let’s talk about the OBV (On-Balance Volume) which has been on a steady climb since April. It bounced off mid-range support at $2.16, and then faced some resistance at $2.5 twice in May. This all led to the recent breakout. Meanwhile, the MFI (Money Flow Index) at 67 is waving a green flag for strong demand. Looks like the bulls are still doing their thing.

The 4-hour chart has a clear message: “I’m not impressed.” We saw a rejection from the highs, but there’s hope. Maybe $2.56, the former resistance, will give CAKE a chance to bounce back and rally for the next leg up. Of course, let’s not get too carried away just yet, as the OBV and MFI still reflect strong bullish pressure, without any sign of a bearish dive. But you know, markets can be fickle.

Liquidity Data: Could CAKE Be Headed for a Tumble?

Okay, let’s get serious for a second. The five-month range is a beast, and breaking it isn’t as easy as baking a pancake (unless you’re a pro, in which case, teach me your ways). Bulls are likely to struggle to power through this level in the coming days. The wild surge from $2.4 to $2.95? Well, that’s probably due to a liquidity build-up from the $2.85–$3 zone. Think of it as a magnet—liquidity attracts price, and CAKE just couldn’t resist.

Speaking of liquidity, the two-week heatmap is telling us something important. There’s a juicy concentration from $2.7 to $2.2. Watch out, the bears are eyeing the $2.61 and $2.28 levels as their short-term targets. So, if you’re thinking of chasing this thing up, maybe take a deep breath and think twice.

With all this data, the conclusion seems to be that CAKE might be about to pull back to that sweet mid-range level at $2.16. Sure, there could be some minor bounces along the way, but don’t get too excited. Now, if Bitcoin [BTC] decides to make a miraculous new all-time high, it could change everything. But until then, expect a bit of a downward correction.

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2025-05-28 09:46