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A win streak does help get a wrestler over with the fans (see Goldberg).
A losing streak does does damage a wrestlers reputation with the fans, but it depends on how the losing streak aligns with whatever angles/storylines the wrestler is in.
The most recent example I can give is when Kane was on losing streak and Austin gave him an ear-full about being a "monster". This led to the unmasking of Kane, and the storytelling of a monster that wants revenge on the world that has outcasted him his entire life. In this case, a losing streak actually helped get the angle more over...more importantly, it was used as a contrasting element to the change in Kane's character.
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