- GameStop shares run out of steam on Friday.
- The stock staged an explosive rally on Thursday, up 52%.
- GME found support at the 50-day SMA.
Gamestop ran out of steam on Friday after an explosive Thursday. GME closed on Thursday up over 50% but Friday saw a more modest day closing down 1.5% at $181.
Stay up to speed with hot stocks' news!
A quick little recap! GameStop is a struggling online video game retailer with shops located all around the world selling – yes, you guessed it – video games. As we all know, retail is a struggling space as online continues to take over, and this has been a trend for GameStop too. As a result, GameStop was heavily shorted by hedge funds as they bet that the price would decline further. That is when the fun began with retail traders on Reddit's r/WallStreetBets forum. They mobbed the stock and moved the shares to nearly $500 in January, before sliding back to sub-$50 by mid-February. They are now currently trying to hold $200.
GME stock news
Traders loaded up on the 50-day SMA support on Thursday, and GME shares rallied nearly 60%. It was a brave move going against the trend. GME shares had been under pressure following the release of mixed Q4 results and a lack of guidance. GameStop had also been rumoured to be considering a capital raise. This all combined to send GME shares sharply lower post results. The shares dropped 6% prior to the results and 33% on the next trading day as the results were posted after the close on March 23.
The 50-day SMA support was rapidly hit circa $120. GME closed the session on March 24 at $120.34. However, short-term and retail traders sensed an opportunity and bought GME shares aggressively straight from the open the next day, in the end causing a huge gain of over 50%. Friday saw calmer trading, but GameStop did hold those gains suffering only a minor 1.5% loss.
GME technical analysis
Currently, we have traded up to some key short-term resistance levels. The short-term 9 and 21 day SMAs are converging at or near $190. GameStop is currently trading at $182.50 in pre-market trading. Failure to sustain the price action above these short-term SMAs is a bearish signal. A break below Thursday's close at $183.50 would also add to bearish sentiment. If these levels hold, the first target to the upside is the $200 psychological level and $218.75, Friday's high.
-637526160663351553.png)
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD stays near 1.0400 in thin holiday trading
EUR/USD trades with mild losses near 1.0400 on Tuesday. The expectation that the US Federal Reserve will deliver fewer rate cuts in 2025 provides some support for the US Dollar. Trading volumes are likely to remain low heading into the Christmas break.
GBP/USD struggles to find direction, holds steady near 1.2550
GBP/USD consolidates in a range at around 1.2550 on Tuesday after closing in negative territory on Monday. The US Dollar preserves its strength and makes it difficult for the pair to gain traction as trading conditions thin out on Christmas Eve.
Gold holds above $2,600, bulls non-committed on hawkish Fed outlook
Gold trades in a narrow channel above $2,600 on Tuesday, albeit lacking strong follow-through buying. Geopolitical tensions and trade war fears lend support to the safe-haven XAU/USD, while the Fed’s hawkish shift acts as a tailwind for the USD and caps the precious metal.
IRS says crypto staking should be taxed in response to lawsuit
In a filing on Monday, the US International Revenue Service stated that the rewards gotten from staking cryptocurrencies should be taxed, responding to a lawsuit from couple Joshua and Jessica Jarrett.
2025 outlook: What is next for developed economies and currencies?
As the door closes in 2024, and while the year feels like it has passed in the blink of an eye, a lot has happened. If I had to summarise it all in four words, it would be: ‘a year of surprises’.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.