Pudgy Penguins [PENGU] tanks 12% overnight: Is a full breakdown next?

PENGU, a once-leading memecoin, has been witnessing sustained capital flight as investors continued to exit their positions.

In the last 24 hours alone, capital outflows contributed to an approximate 12% decline in price, with Pudgy Penguins [PENGU] trading at $0.0097 at the time of publication.

The asset is not alone in this downturn. The broader memecoin market is also experiencing significant losses, with an average weighted decline of about 27% over the past day.

PENGU hits resistance

PENGU’s decline over the last day has been driven by strong selling pressure after it traded into a well-established resistance wall.

Ideally, a sell-off at this level tends to deepen depending on the amount of liquidity clustered around this resistance zone on the chart.

The most recent move into this area previously triggered a 53% drop, as PENGU found a local bottom before its most recent rebound.

Source: TradingView

However, the average price reaction over the last three occasions of trading into this zone pointed to a more moderate sell-off, which resulted in an average decline of 31.7%.

Typically, a breakout above this declining resistance wall often marks the start of a broader rally.

In this case, that breakout has not occurred, and PENGU is now likely to search for the nearest support level before attempting a rebound.

Momentum fades

Bullish momentum has exited the market, as reflected by both the Money Flow Index (MFI) and the Parabolic SAR indicators.

The Parabolic SAR helps identify whether the prevailing trend is bullish or bearish, offering insight into where traders are placing their bets.

At the time of this report, the Parabolic SAR dots have formed above the price, signaling strong selling pressure and suggesting that the asset could decline further.

Source: TradingView

The MFI presents a slightly more nuanced outlook. This indicator uses defined regions on the chart to judge sentiment. A reading between 50 and 80 represents a buy zone, while 30 to 50 represents a sell zone.

Currently, the MFI remains in the selling region, confirming an overall bearish trend.

However, the MFI line is moving upward toward the buy zone, suggesting that some capital inflow is returning, albeit at a modest level compared to the magnitude of the recent outflows.

Community interest wanes

Community interest in PENGU has continued to decline steadily. The Community Sentiment chart, which tracks whether investors are bullish or bearish on an asset, shows a notable drop in optimism.

While over 90% of investors previously expressed bullish sentiment toward PENGU, that figure dropped sharply to 72% as of the 30th of November.

This data was based on responses from 375,000 investors, according to CoinMarketCap.

Source: CoinMarketCap

In the derivatives market, investors withdrew approximately $6.5 million from their positions as PENGU’s condition worsened over time.

When assessed alongside the Funding Rate, the outflow remains evident, reinforcing the likelihood of further downside pressure in the near term.

Final Thoughts

• PENGU hit key resistance, sparking intense selling pressure as it trades below its daily open.
• Indicators suggest sentiment could worsen as capital flight continues to dominate the market.