Pudgy Penguins Token (PENGU) has grabbed the attention of many technical analysts after a TD Sequential buy signal appeared on the 12-hour timeframe. This signal indicates that the market may be running out of steam, which could lead to an eventual price reversal in PENGU. After some volatile peaks, PENGU has been quiet lately. For the past two months, it’s mainly been consolidating in a lower range between $0.009 and $0.013, building a new base.
Technical Analysis Points to Potential 30% Recovery
TD Sequential identifies possible trend exhaustion in the financial markets using a momentum-based system. A “9” signal on this indicator means there is likely to be no more selling pressure, which makes it possible that a reversal could occur.
Ali, a market analyst, has made a note of the recent buy signal from PENGU at identified support areas via TD Sequential analysis. This technical signal has gained attention among traders due to previous similar occurrences providing indications of major pending price recoveries whenever momentum changes to favor buyers.
An analyst named Nehal has observed a descending channel pattern in the price of PENGU through his price action analysis. According to her findings, the token was testing the descending channel boundaries near USDT 0.017, with a potential for a successful bounce to create a rebound (based on the durability of support) of 30-33%. If the projected movement occurs, it may increase the price of PENGU to its next resistance zone, between USDT 0.021 to USDT 0.023.
On-Chain Data Drop Hints at Contradictory Signals
On-chain data shows a subdued narrative though the technical indicators are giving an optimistic picture. According to Nansen, PENGU has experienced substantial outflows from exchanges since the $4.1 million left exchanges indicating holders are moving tokens off platforms and not preparing to sell. This behavior usually sets near-term reduced supply, and this is often considered a positive for price appreciation.
However, trader positioning is confused, while some smart wallets have been actively accumulating, as fresh inflows of $38.9 million into new wallets, there are other data which point to caution. Open Interest fell more than 8% to total $282 million, to reduced leverage as traders have been closing position so rather than adding exposure.
Ecosystem Developments Support Long-Term Value
The Pudgy Penguins project has developed a substantial, well-structured ecosystem that goes well past traditional meme investing; below the price action, they are also executing a “phygital” strategy of incorporating NFTs with real-world goods. They have created more than $13 million in retail sales by partnering with companies like Walmart, Target, and Walgreens to achieve this success.
Over 1 million of the original physical Pudgy Penguins toys have been sold, all of which have had QR codes on them that provided respective unique digital traits to each toy. As a result, the Pudgy Penguins have gained incredible brand recognition well beyond the crypto community after securing a place in major retail outlets.
Recently, new growth opportunities emerged with the launch of Pudgy Party, a mobile game developed in partnership with Mythical Games. Created specifically for NFTs, the game offers players the ability to own and trade their customized penguin avatars as NFTs while utilizing both NFT-based ownership along with play-to-earn features.
Conclusion
On PENGU’s chart, a TD Sequential buy signal shows a major technical change indicating that the token could be close to an inflection point. When added to large exchange outflows and testing of support levels, it appears that conditions are right for possibly recovering by as much as 30%.
Confirmation is important before stating a bottom because there are mixed messages based on smart money positions. For long-term investors, retail and mobile gaming developments will provide a more solid foundation than short-term speculation.
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