Pudgy Penguins’ native token, PENGU, slid 5.48% in the past 24 hours—lagging behind the broader crypto market’s 4.09% decline—and extending a steep 27% weekly loss. The downturn stems from a confluence of fading enthusiasm around its high-profile Manchester City partnership, reputational turbulence following a controversial social media post, and a decisive technical breakdown that amplified selling pressure.
The initial excitement surrounding PENGU’s January 15 announcement of a collaboration with Manchester City—a club with over 300 million global fans—briefly lifted the token. However, the rally quickly reversed as traders capitalized on short-term gains. The partnership, centered on co-branded NFTs and merchandise launched on January 17, offered no immediate utility for the PENGU token itself, triggering a classic “buy the rumor, sell the news” dynamic. Historical precedent supports this pattern: similar retracements followed other major announcements, such as the market’s reaction to the SEC’s delayed ETF decision earlier in January. Investors are now watching closely to see whether the tie-in translates into sustained NFT demand or tangible revenue from merchandise sales.
Compounding the bearish sentiment was a self-inflicted wound on social media. On January 19, the Pudgy Penguins account posted a tweet perceived as mocking India’s economy—an act widely criticized as culturally insensitive. Though the post was swiftly deleted, the backlash lingered, tarnishing the project’s carefully cultivated family-friendly image. Social analytics reflected the fallout: conversation volume spiked by 23%, coinciding with a noticeable dip in price, according to CoinMarketCap data. For a brand built on whimsy and inclusivity, the incident risked alienating a core segment of retail supporters.
Technical indicators further reinforced the downward momentum. PENGU breached the critical $0.011 support level, unleashing a wave of stop-loss orders and algorithmic liquidations. Trading volume surged by nearly 24% to $151.5 million, underscoring strong bearish conviction. The RSI (14) dipped to 38.03—approaching oversold territory but without bullish divergence—while the MACD confirmed bearish momentum with a crossover and a histogram reading of -0.000305. The next significant technical floor lies at $0.00968, representing the 78.6% Fibonacci retracement level.
In sum, PENGU’s recent slump is less about fundamental deterioration and more a reflection of evaporating short-term hype, reputational missteps, and technical vulnerability. While the Manchester City alliance holds long-term promise for brand expansion, the market has so far prioritized immediate catalysts—or the lack thereof. Traders should monitor whether PENGU can stabilize near the $0.00968 support zone, alongside shifts in broader market sentiment, NFT sales performance, and social sentiment recovery as potential reversal signals.
Source:: From Manchester City Highs to Market Lows: The PENGU Correction Explained