PENGU Price Jumps 10%, but Key Signals Suggest a Temporary Rally

Key Takeaways

• PENGU’s price surge coincides with Coinbase listing but risks falling below the descending trendline.
• Indicators, including the RSI and CMF, reveal weak bullish momentum, reinforcing the potential pullback.
• PENGU’s price faces an overhead resistance, which could trigger the memecoin to go toward another all-time low.

The price of the Pudgy Penguins (PENGU) token has increased by 10% in the last 24 hours. This comes days after the memecoin tanked to an all-time low of $0.0093.

However, despite this recent hike, several indicators reveal that this could be a brief rally before another decline. With trading volume failing to confirm strong buying momentum, here is why PENGU’s uptrend could be a trap for late buyers.

Weak Momentum Threatens PENGU’s Recovery

PENGU’s price surged to an all-time high of $0.057 after its launch and airdrop but has since dropped 81%. While the token recently gained 10%, CCN found that the jump likely happened due to Coinbase’s announcement to list the asset.

According to the crypto exchange, trading will start at 9 AM Pacific Time (PT) on Feb. 13. On the 4-hour chart, the price increase to $0.010 drove the token above the descending trendline, which it has been stuck in for nearly a month.

As of this writing, PENGU’s price is slipping back into the channel. The failure to sustain its gains suggests that the recent surge might be a dead cat bounce.

A dead cat bounce indicates that the asset recovery is temporary, and the downtrend experienced earlier might continue afterward.

The Relative Strength Index (RSI) position also aligns with this thesis. During the uptrend, the RSI reading rose above the 50.00 neutral points, indicating bullish momentum.

However, as seen above, the indicator is trending towards falling below the signal line. If that happens, the dead cat bounce might be confirmed, and PENGU’s price could reverse all its gains.

PENGU Price Prediction: New Low Looming

The daily chart shows a similar setup, with overhead resistance at $0.017—where the red Supertrend line sits. Typically, when the green line of the Supertrend is below the price, it indicates a buy signal.

Since the indicator is above the price, it signals a sale. If PENGU attempts to reach $0.017, it could face a pullback, confirming the fakeout.

In addition, the Chaikin Money Flow (CMF) reading failed to rise above the zero line despite the recent price increase. The CMF position indicates that PENGU continues to struggle to attract high demand to sustain the rebound.

If this remains the same, the Pudgy Penguins token’s value could slide again. Using the Fibonacci retracement levels, PENGU could drop to another all-time low of $0.0035 if the buying pressure completely fades.

On the flip side, this might not be the case if momentum becomes bullish and buying pressure increases.

The cryptocurrency could rally toward the 0.618 Fib level at $0.045 in that scenario. However, to attain these targets, the key resistance at $0.019 and $0.029 might play a key role.

Rising above these levels could validate the uptrend, while failure to breach them could trigger another correction.