The Pudgy Penguins token PENGU faced a severe price decline, falling from $0.045 to $0.023 between July and October 2025, driven by aggressive Federal Reserve rate hikes, persistent inflation, and a broader liquidity crunch that triggered $19 billion in market liquidations.
Technical indicators, including bullish flips in OBV and MACD, along with a double bottom pattern, suggest a potential short-term rebound toward $0.01175, supported by daily trading volume reaching $202 million. However, structural weaknesses persist, with PENGU underperforming the altcoin market by 68% since July and showing deep correlation to Solana, exacerbating declines.
On-chain data reveals fading holder conviction, with outflows across all wallet tiers—large wallets reduced holdings by 85%, team-controlled addresses moved $66.6 million, and $8.91 million shifted to centralized exchanges, indicating potential selling pressure. Supply concerns mount as team-held tokens constitute 18% of circulating supply, with upcoming unlocks likely to sustain downward momentum.
Risks include heavy USDT reliance (82.5% of exchange pairs), leaving PENGU vulnerable to depegging events, and regulatory threats from frameworks like EU MiCA. Despite fair value estimates of $0.02782–$0.068 aligning with current prices, analysts warn of a possible 55% further drop if market sentiment doesn't improve, emphasizing the token's crossroads between recovery and continued decline.
