CAKE → Three Pushes Up! Will We Reverse to $2.84? Let's Answer.CAKE (Pancakeswap) completed its third push to the upside and rendered four Daily candles in a row with large wicks on the top. Today's close marks the fifth. Does that mean we're in for a drop?
How do we trade this? 🤔
I believe a pullback here is imminent. That doesn't mean a short is justified, we are in a bull trend and our bias should remain long. However, the short-term signals like the three legs, 5 wicks on top, and a high RSI all indicate a pullback is here.
It's reasonable to short this on a lower timeframe like the 1HR but on the Daily, we should be looking for a long. Wait for the price to come back down to the $2.84 area and find support. We need to see a strong buy signal and confirmation bar to justify an entry. I caveat this proposal with the state of the crypto market as a whole, it's a pivotal moment that could spell a reversal which will likely drag CAKE down with it.
In summary, zoom into the 1HR timeframe to find a short, wait for a long entry opportunity at $2.84 per my description above.
💡 Trade Idea 💡
Long Entry: $2.937
🟥 Stop Loss: $2.64
✅ Take Profit: $3.53
⚖️ Risk/Reward Ratio: 1:2
🔑 Key Takeaways 🔑
1. Bull Channel with three pushes up, large wicks on third push.
2. Gap to Daily 30EMA.
3. Don't enter a trade here, need more price action.
4. RSI at 75.00 and above Moving Average. Supports Pullback.
5. Crypto Market at Pivotal Moment, Consider Reversal Possibility.
💰 Trading Tip 💰
You can trade any candle on the chart, the question is what trades are more worth your while and fit with your personality traits. First, understand how to analyze a chart, then understand yourself and how you best interact with your analysis such that you make money.
⚠️ Risk Warning! ⚠️
Past performance is not necessarily indicative of future results. You are solely responsible for your trades. Trade at your own risk!
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