PancakeSwap V2, the Top DEX by Volume: Rally Incoming for CAKE?
PancakeSwap has emerged as the top decentralized exchange this past week which has been characterized by sizable recovery. This ranking may have also influenced a strong rebound in CAKE appetite judging by its sharp uptick.
According to TCC, PancakeSwap secured a spot in the list of leading DEXes by volume. According to Coinmarketcap’s DEX ranking, PancakeSwap garnered over $1.324 billion in daily volume.
PancakeSwap’s impressive volume allowed it to secure the second spot in the list after HyperLiquid which had more than double the volume at $2.8 billion.
The robust volumes confirm the return of excitement in the crypto segment, which signals accumulation. This is in line with the relief rally observed in the last 5 days.
CAKE Demand Fuels Impressive Recovery for PancakeSwap Price
PancakeSwap’s impassive DEX volume points to spike in activity this week which resulted in more demand for its CAKE token. This, combined with the subsequent demand from the spot and derivatives segment yielded a 14% plus price surge in the last 24 hours. CAKE exchanged hands at $1.86 at the time of observation.
The bullish surge not only allowed CAKE to finish strong this past week but also fueled its escape from recent lows. Its press time price tag was a 33% premium from its latest local lows which also happened to be within an important historical area of support.
CAKE’s upticks in December and February also highlight a descending resistance line. Price could potentially retest this resistance between $2 and $2.3 if it maintains its upward trajectory this week.
CAKE was also up 10.26% in the last 7 days, effectively earning it a spot among the best performing coins in the top 100 by marketcap.
Massive Spike in CAKE Volume Highlights Potential Liquidation Risks
CAKE’s bullish price action was backed by a noteworthy surge in volume within the derivatives segment. Its volume in the last 24 hours amounted to $124.28 million after surging by 290.88%. Open interest also ticked up by 35.19% during the same period.
While a strong comeback was observed in the derivatives segment, things were rather different in the spot segment.
Spot flows were relatively weak and in the red. CAKE had $52,710 worth of outflows in the last 24 hours.
The difference between spot and derivatives activity suggests that the latest upside might be highly leveraged. This could pave the way for heavy liquidations, in which case a potential leverage shake down might have the bulls in a choke-hold.
Previous CAKE upticks in December and February after each dip were accompanied by surges in whale activity.
While IntoTheBlock data confirmed that there was an uptick in whale activity, it remained relatively weak.
To put things into perspective, the last whale activity data from 14 March revealed a positive netflow of 55,830 CAKE.
The spike in whale activity on 19 December was 14 times higher. In other words, weak whale demand could contribute to limited upside if it maintains the same trend.
