@Dave256 - you should not cancel. You need to contact Airbnb via twitter, and ask THEM to cancel the booking.
Otherwise, yes, you will be penalized.
Make sure you state, in your conversation, that youa re asking them to do it as you would not like to loose your superhost status.
@Frances34 - you should have let the guest cancel, they asked you to cancel, and you accepted the cancelation - this is a different process.
@Joanna188 - if you cancel, you loose the status for 1 year. You can change your settings to only accept booking for the next 6 months / 9 months / 12 months. You can change that in your settings.