It appears that Pudgy Penguins (PENGU) will continue its downtrend, with a short-term bounce serving more as a liquidity grab rather than a trend reversal.

PENGU in a Deep Decline, NFT Collection Also Losing Momentum

  • Pudgy Penguins [PENGU] has dropped 11% in the past 24 hours and has lost 32.2% over the past week.

  • This decline is closely linked to Bitcoin’s [BTC] weak performance and broader struggles in the altcoin market.

  • According to OpenSea, the floor price of the Pudgy Penguins NFT collection has dropped by 47% over the last month.

  • Both sales volume and prices have declined over the past three weeks, indicating a market correction and cautious buyers.

Source: OpenSea

Declining Social Dominance and Negative Sentiment

  • Data from Santiment shows that weighted sentiment around PENGU has been negative since late December.

  • Social dominance of the project has dropped sharply in January, meaning it is receiving less attention on social media.

  • This decline in social activity aligns with PENGU’s weak price action and the slow recovery of investor confidence.

Source: Santiment

Technical Analysis Signals Further Losses

  • Based on PENGU’s rise from $0.0226 to $0.0469 in late December and early January, key Fibonacci retracement levels were drawn.

  • In mid-January, the price appeared to respect these levels, suggesting potential stabilization around $0.0278.

  • However, strong selling pressure over the past two weeks has erased bullish recovery hopes.

On January 26, PENGU retested the 78.6% Fibonacci level as resistance, but the price has been in free fall since.

Source: PENGU/USDT on TradingView

Liquidation and Market Pressure: A Move Above $0.0185 Is Unlikely

  • The A/D (Accumulation/Distribution) indicator continues to decline, signaling that the market is not holding long positions.

  • The CMF (Chaikin Money Flow) indicator has dropped below -0.05, indicating a strong capital outflow from the market.

  • Liquidation heatmaps show clustered short liquidations between $0.018 and $0.024.

  • Given the current selling pressure and bearish momentum, a break above $0.0185 is highly unlikely.

Source: Coinglass

What’s Next for PENGU?

At the time of writing, the most probable scenario for PENGU is a short-term bounce to $0.0185, which could attract liquidity before continuing the downtrend.

Investors should closely monitor key support levels and trading volumes, as further market weakness could see PENGU breaking below $0.018.

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