CAKE Technical Analysis Feb 4

CAKE is trading in a critical squeeze zone at $1.52; while the oversold signal on RSI offers hope for upside, the descending channel and Bitcoin’s weakness strengthen the downside scenario. Both scenarios carry equal probability based on market data.

Current Market Situation

CAKE is trading at $1.52 with a 2.44% decline over the last 24 hours and is stuck in the $1.49-$1.60 range. The overall trend is downward; the price remains below EMA20 ($1.77), MACD shows a negative histogram, and the Supertrend indicator is giving a bearish signal. RSI at 28.01 is in oversold territory, signaling potential short-term bounce buying, but volume is low at $25.14M. Multi-timeframe (MTF) analysis identified 11 strong levels on 1D, 3D, and 1W charts: supports at $1.4203 (81/100 score) and $1.4953 (65/100), resistances at $1.6231 (65/100) and $1.7155 (67/100) stand out. This structure reflects a consolidation phase where the price could break out in either direction.

Scenario 1: Upside Scenario

How Does This Scenario Unfold?

For the upside scenario, a close above $1.60 resistance is required first, followed by a clear break of $1.6231. The oversold RSI level (28), if supported by a divergence, could increase momentum; a positive MACD crossover is expected as the histogram approaches zero. An increase in volume and breaking above the upper band of the descending channel ($1.7155) could trigger this scenario. Stabilization or recovery in Bitcoin would boost risk appetite in altcoins, supporting CAKE. If this breakout does not occur, the scenario becomes invalid at the $1.4953 support.

Target Levels

First target is $1.86 Supertrend level above $1.7155 resistance, followed by $2.1090 (26-score target). With stronger momentum, resistances from the 1W timeframe could extend to around $2.50. The risk/reward ratio from current levels is approximately 1:2.5, but holding these levels requires volume confirmation.

Scenario 2: Downside Scenario

Risk Factors

The downside scenario is triggered by a close below $1.4953 support; if broken, $1.4203 (81/100 score) could be tested. MACD’s expanding negative histogram and staying below EMA20 sustain bearish momentum. If Bitcoin loses its $72,946 support, rising BTC dominance could accelerate altcoin selling. Low volume and the overall market downtrend increase this risk. Failure to hold above $1.6231 is critical for invalidating the upside.

Protection Levels

First protection is the $1.30 zone below $1.4203, with the main target at $0.8513 (22-score bearish target). In a deeper correction, 3D timeframe supports could drop to $1.10. The current R/R ratio is around 1:1.8, manageable with stop-losses placed below $1.4953.

Which Scenario to Watch?

The decision point is the $1.4953-$1.6231 range; an hourly close above $1.6231 confirms upside, below $1.4953 confirms downside. Confirmation signals like volume increase and RSI divergence should be monitored. MACD crossovers and Supertrend flips provide additional confirmation. Daily candle closes play a critical role in identifying moves aligned with the weekly trend.

Bitcoin Correlation

CAKE is a highly correlated altcoin to Bitcoin; BTC is in a downtrend at $73,239 with a 4.71% decline and Supertrend bearish. If BTC holds $72,946 support, limited recovery in altcoins is possible, but a break to $70,072 would add pressure on CAKE. If BTC resistances at $75,111-$77,946 are not overcome, rising dominance strengthens CAKE’s downside scenario. BTC stabilization should be monitored: correlation data can be followed on the CAKE Spot Analysis and CAKE Futures Analysis pages.

Conclusion and Monitoring Notes

Both scenarios for CAKE are valid based on technical data; traders should monitor $1.4953-$1.6231 breakouts, volume confirmations, and BTC movements. RSI recovery or MACD weakening provides early warnings. Apply your own risk management while following market developments; lack of news flow highlights technical levels.