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- PENGU fell 9% in 24 hours as $70M exited the market.
- Investors accumulated $14.5M worth of tokens, reducing exchange supply.
- Technicals show weakening bearish momentum, signaling a potential rebound.
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Pudgy Penguins [PENGU] saw a sharp decline of more than 9% in the past 24 hours, cutting its monthly gains to 23% as of press time. The drop followed a significant liquidity outflow across the broader market, yet on-chain and technical signals suggest that a rebound may soon be on the horizon.
Liquidity Outflow Drags PENGU Lower
The immediate pressure on PENGU’s price was linked to liquidity leaving the market. Data from CoinGlass showed nearly $70 million in outflows within a single day, while Open Interest (OI) dropped to $332.66 million. Both long and short traders reduced their exposure, though long positions faced heavier liquidations.
Adding to this weakness, PENGU’s OI-Weighted Funding Rate plunged from 0.0265% to 0.0063%. While the decline reflects reduced long trader activity, the fact that the rate remains positive indicates ongoing bullish interest.
Buyers Still Accumulating Despite Pressure
Despite liquidity challenges, demand for PENGU has not disappeared. CoinGlass data revealed that in the past 72 hours, investors purchased over $14.5 million worth of tokens, moving assets into private wallets. This behavior suggests that fewer tokens are circulating on exchanges, reducing the likelihood of steep sell-offs.
On the charts, PENGU is nearing a critical support level inside a bullish triangle structure. Analysts expect a potential minor dip before a rebound, signaling that the current correction may be short-lived.
Also Read: BTCS Diversifies Treasury With Pudgy Penguins NFTs as PENGU Price Surges
Technicals Point to Reversal Potential
Momentum indicators also support the case for a recovery. The Chaikin Money Flow (CMF) rose to 0.04, showing an increase in buying pressure. At the same time, the Average Directional Index (ADX) dropped to 20.91, highlighting weak bearish momentum. When the ADX declines while price stabilizes, it often signals an impending reversal.
Although PENGU faced a steep decline due to market-wide liquidity outflows, accumulation trends and technical indicators hint at a bullish recovery. If support levels hold, Pudgy Penguins could quickly regain momentum and extend its monthly gains.
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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
I’m a crypto enthusiast with a background in finance. I’m fascinated by the potential of crypto to disrupt traditional financial systems. I’m always on the lookout for new and innovative projects in the space. I believe that crypto has the potential to create a more equitable and inclusive financial system.
