Bitcoin And PankcakeSwap Token (Btc vs CAKE)

One of the pupular cryptocurrency otherwise known as bitcoin has some unique relationship with other tokens such as ethereum has a positive or negative influence in other tokens.

However, it quite interesting to know that bitcoin may have a positive or negative relation in fact in some cases there is little or no correlation between bitcoin and some tokens.
This article will analyse what type of relationship tends to exist between bitcoin and CAKE, a token on PancakeSwap.

Objectives Of The Study
In the course of this article, I shall tend to cover the following subtopics under influence test on both token prices.

Categories of influence analysis.

Under influence analysis, the result will be interpreted in any of the listed terms below.

Positive influence
Positive influence between the price of bitcoin and that of CAKE is positive when the price of bitcoin express a bullish influence, the price of CAKE experiences same as well and vice versa. . This is said to be a positive influence and it tends towards +1.

Negative influence
Negative influence between the price of bitcoin and that of CAKE is negative when the price of bitcoin express a bullish influence, the price of CAKE experiences bearish. This is said to be a negative influence and it tends towards -1.

Zero influence
Zero influence indicates that there is no link between the price of bitcoin and that of CAKE in the crypto market.

This test uses letter “r” to indicate the category in which the relationship falls into. It was invented by a statistiscian named Karl Pearson. He proved variable existing can have a positive, negative or even zero correlation between the variables.

For a positive relationship r = 1 or tends towards a positive 1 axis.

For a negative relationship r = -1 or tends towards a negative 1 axis.

For zero relationship r = 0 or tends towards the zero axis.

Significance of the analysis
Test of influence is a theory to prove whether there is an influence that exist between the price of bitcoin and CAKE token.

What direction does the influence heads to?.

It is also essential to indicate the strength of relationship if it’s a weak one or a strong one.

I shall attempt to collect data from coingecko.com as regards the price of bitcoin and that of CAKE for the period of June 4 – June 23, 2022.

The price of bitcoin and CAKE are the second and the ninth variable in the variable view mode of SPSS software.

The prices are further arranged in a data view mode of SPSS software.
From the analysis of both prices, we shall attempt to consider running a scatter dot diagram.

From the scatter dot diagram, we can consider a positive relationship. We have to view the strength of positivity of such relationship.

Result
The result of correlation is interpreted on a scale from -1 to +1.
-1 -----------------------------0-------------------------+1

The result of the analysis shows that the coefficient of correlation r= 0.978 indicating it’s close to positive 1 axis. This indicates that as the price of bitcoin goes climbs, the price of CAKE does so at same rate. If bitcoin experiences a dip, CAKE token will also experience same rate.

Below is the maximum and minimum price of both tokens.

Conclusion
In a nutshell bitcoin has a positive influence on CAKE token