Introduction

PancakeSwap (CAKE) has experienced a notable decline of approximately 11% from its recent local high, and market analysts warn that further drops of up to 7% could be on the horizon in the next few hours.

Market Resilience

Despite this setback, the bulls have shown strong resilience over the past fortnight, managing to drive prices higher, particularly following a significant surge on March 17. This spike not only resulted in robust gains but also created a fair value gap on the 1-day chart—a crucial indicator for traders.

Current Market Structure

The current market structure shows that PancakeSwap has been navigating within a defined range since early 2025, fluctuating between $1.37 and $2.94, with a pivotal midpoint at $2.16. The recent rally led to the highest trading volume seen in four months, indicating substantial interest. However, over the weekend, market bears thwarted further advances, with resistance firmly established around $2.85.

Price Action and Support Levels

As this price action unfolds, analysts have observed a significant fair value gap that could lead to further market movements. With the price slipping beneath the critical support level of $2.55, a drop towards the mid-range support at $2.16 seems increasingly likely.

Technical Analysis

On the technical front, the On-Balance Volume (OBV) has revealed a strong upward trend over the last two weeks, surpassing the February highs. The Awesome Oscillator, which measures momentum, corroborates this positive outlook. Consequently, it is anticipated that the current retracement may not extend below $2.16, reinforcing the bullish sentiment.

Key Levels to Monitor

The 1-month liquidation heatmap illustrates crucial short-term levels for CAKE, establishing a trading range between $2.22 and $2.84 within the broader 3-month framework. Notably, there is a concentration of liquidity around $2.36—just below the current market price—and an additional liquidity pocket at $2.22.

Traders should pay close attention to how CAKE reacts at these levels, particularly at $2.22 and the lower $2.15 mark. A rebound in bullish momentum, accompanied by spikes in trading volume after a retest of these support levels, could signal the onset of a bullish reversal.

Conclusion

In summary, despite the recent price drop, the underlying technical indicators suggest that the bulls remain in control, and a significant reversal may be on the horizon. For traders looking to capitalize on potential upward movements, keeping a close eye on these key support levels will be essential.