Key Takeaways
- PENGU surged 9.6% in 24 hours, driven by strong buying activity in the derivatives market, with a positive funding rate and long-heavy sentiment.
- Despite the bullish outlook from derivatives traders, over $808K in spot selling raises concerns about potential short-term downside.
Pudgy Penguins [PENGU], a rising memecoin, has captured market attention after a notable 9.6% price surge over the past 24 hours. Despite the rally, on-chain activity reveals a striking divergence between derivatives and spot traders, setting the stage for an uncertain short-term trajectory.
Derivatives Traders Show Confidence in Further Gains
Data from CoinGlass shows a surge in bullish sentiment among derivatives traders. Over the last four hours, the Long/Short Ratio stood at 52.67% in favor of long positions. The bias toward long trades was even more pronounced over the 24-hour period, with 54.01% of positions leaning long. This suggests growing confidence among leveraged traders that PENGU could extend its rally.
Fueling this optimism further, the Open Interest-weighted Funding Rate flipped positive—typically a signal that long positions dominate the market. Historically, such funding rates have preceded bullish price movements, reinforcing hopes of sustained upward momentum.
Spot Traders Continue to Sell, Signaling Uncertainty
In contrast, spot traders appear to be capitalizing on recent gains. Within the past 24 hours, over $808,000 worth of PENGU has been sold on spot markets. While this could represent routine profit-taking, the volume suggests deeper selling pressure. If selling persists, it may signal a broader reduction in exposure to PENGU, potentially capping the memecoin’s upside in the near term.
This divergence between spot and derivatives markets reflects uncertainty about the sustainability of the rally, as profit-booking could offset the optimism of leveraged traders.
Also Read: Pudgy Penguins Launch Music Label ‘Pudgy Records’ as PENGU Eyes Bullish Breakout
Liquidity Clusters Could Pull PENGU Higher
Despite the opposing actions of spot traders, market liquidity data points to a possible continuation of PENGU’s rally. CoinGlass identified significant liquidity clusters above the current price level, particularly around $0.015. Liquidity clusters often act as magnets for price action, and if current conditions hold, PENGU could rise to test these higher levels.
In summary, while derivatives traders are betting big on PENGU’s upside, ongoing spot selling poses a challenge. Whether the bullish momentum can overcome selling pressure will likely depend on how long leveraged sentiment remains dominant in the market.
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.
