Pudgy Penguins [PENGU], a rising star in the memecoin world, has officially overtaken Dogwifhat [WIF] in market capitalization as of December 26. This significant milestone underscores the growing demand for PENGU, driven by its strong price performance and the increasing popularity of the Pudgy Penguins NFT collection.
PENGU’s Potential for a Breakout
The PENGU token is teasing a potential range breakout, showcasing promising technical patterns. On the 4-hour chart, the altcoin has maintained its bullish structure, trading comfortably above the mid-range support at $0.312. The range, defined between $0.394 and $0.289, highlights the current consolidation phase.
Notably, the Chaikin Money Flow (CMF) indicator is above +0.05, signaling robust capital inflows. However, trading volume has declined over the past two days, indicating some hesitation among market participants. The initial breakout attempt on December 25 came with average trading volumes, suggesting a lack of conviction, but the potential for a retest of the overhead resistance remains high.
The Directional Movement Index (DMI) adds to the bullish narrative, with both the +DI (green) and ADX (yellow) indicators above the 20-mark, pointing to a strong upward trend.
Challenges on the 1-Hour Chart
Zooming into the 1-hour timeframe, PENGU faced a full retracement of its breakout attempt, leading to a bearish structure. Buyers now aim to defend the $0.35 support zone, a critical hourly order block. Overcoming the recent lower high at $0.39 will be pivotal for bulls to regain momentum.
Decline in Open Interest
Data from Coinalyze reveals a drop in Open Interest, reflecting weak short-term sentiment but no significant short-selling pressure. This indicates that market participants remain cautious rather than overwhelmingly bearish.
What’s Next for PENGU?
A successful defense of the $0.35 support could propel PENGU toward new highs. However, failure to hold this level may flip the 4-hour bullish structure, potentially leading to a retest of the mid-range support at $0.312.
With its growing NFT ecosystem and increasing market interest, PENGU is proving that it’s more than just a passing trend in the memecoin space. Its ability to maintain bullish momentum and attract capital will be key factors in determining its long-term viability.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
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