- PENGU has declined significantly in the past 24 hours as the memecoin market begins to underperform.
- Hope surfaces as a key support level and liquidity zone come into sight.
In the last 24 hours, Pudgy Penguins [PENGU] has declined by 12.59% as the memecoin market begins to experience liquidity outflows.
Analysis shows that PENGU has a chance to recover as it approaches a key support level on the chart, but there’s more to consider.
High momentum, low liquidity — How it impacts PENGU
PENGU’s recent decline appears to be a coordinated effort, as the momentum behind the sell-off is high.
High momentum is determined by trading volume. A rising volume implies that momentum is strong.
Over the past 24 hours, trading volume, according to Coinglass, has risen by 63.39% to $177.90 million.
Historically, when an asset declines and volume increases, it suggests that selling pressure is likely to continue and that the asset may keep falling.
With this sentiment, PENGU’s potential for a continued downward movement remains high. But there’s more to the story.
AMBCrypto could link this decline to the broader performance of the memecoin sector.
Source: Artemis
According to Artemis, the memecoin market continues to underperform, recording massive liquidity outflows.
Until the time of writing, its past month performance showed a 9.1% increase, placing it among the top 10 performing ecosystems.
However, in the past 24 hours, it ranked among the bottom 10 performing ecosystems after recording a 5.2% decline.
A continued outflow like this indicates a high potential for the asset’s price to move downward.
Will buybacks pull PENGU from the fall?
Amid this notable market decline, some buyers have stepped in. The spot market shows more buying than selling in the past three days.
Over the past week, total trades were net positive for PENGU, with $2.89 million of the asset accumulated from the market, despite the potential for further declines.
Source: CoinGlass
What’s more, PENGU now trades at a key support level, precisely at $0.010865. Typically, this triggers buying activity, as unfulfilled buy orders lie at this level.
If it does, it could mark a major step toward a rally. Still, the asset faces a descending resistance line, marked by dashes. Otherwise, it could continue to decline.
Source: TradingView
Strong upward potential
Using the liquidation heat map, data shows that PENGU has a higher chance of making a major upward move.
Currently, high levels of liquidity clusters are found near the top of the chart around $0.012. Typically, price tends to be attracted to levels with such liquidity concentrations.
Source: CoinGlass
If this path holds, it would support the other bullish indicators — increased spot purchases and the key support level.
