Key Takeaways
PENGU rallied alongside the broader crypto market, supported by adoption across crypto, mainstream, and institutions. Will PENGU’s explosive rally hold, and can resistance at $0.036 finally break?
Memecoins outperformed the crypto markets, with Pudgy Penguins [PENGU] gaining more than 15% in a day. It led all other memecoins in returns on the day.
In addition to this, trading volume jumped 220% within hours, crossing $1 billion.
The surge followed Fed Chair Jerome Powell’s speech at Jackson Hole, where he hinted at potential rate cuts in September.
PENGU faces corrective wave resistance
Technical analysis pointed out that price action remained in a correction phase despite the bullish momentum. Analyst Ali Martinez stressed this outlook but noted that PENGU had all it takes to hit $0.10.
On the charts, PENGU was still trading within a corrective channel, with the upper resistance as the determinant of the next leg up. A break could set the memecoin for the $0.046 target before the ultimate one at $0.10.
At press time, PENGU traded near $0.035 after forming a double bottom at support.
Naturally, the bull flag hinted at a potential bullish continuation, with the DMI now turning to the upside. Still, the price had to break above the pattern for confirmation.
Source: TradingView
On Velo, the Aggregated Open Interest (OI) broke above a descending trendline.
Per Byzantine General on X (formerly Twitter), OI reached $5.29 billion. At the same time, aggregated volume reached $21.71 billion.
More longs form below current price levels
A look into the liquidation levels showed that more than $30 million in longs were awaiting to be triggered just below current price levels.
Short orders clustered above $0.036, but were less concentrated. This suggested that traders were less confident in a downside scenario.
On top of that, the buildup below reflected expectations of liquidity sweeps before the next move.
Source: CoinGlass
Liquidity drives crypto prices. Having said that, PENGU could head either direction to capture liquidity. A move higher might trigger a short squeeze. In contrast, dips could fill those long orders and extend the rally.
What’s driving PENGU’s surge?
Worth noting were the driving forces behind this memecoin’s price surge. Among them were crypto, institutional and mainstream adoption. These factors backed their marketing push.
Specifically, PENGU was listed on major exchanges, including CBOE, spot ETF filings, SEC acknowledgement and partnerships with institutions like VanEck and Bitwise.
The community was enjoying more than 5 million social media followers, with over 2 million on stores. Pudgy Penguins’ sales were being rolled out in Asia, with Upbit listing helping in more recognition.
All together, PENGU’s fundamentals pointed toward a strong memecoin backed by its growing adoption. Still, caution was needed as the structure had not broken from the bull flag to confirm the next leg up.
