A look at the latest developments and possible future scenarios for GameStop and the GME memecoin. Is a Short Squeeze 2.0 coming?
After nearly three years away, Keith Gill, famously known as “Roaring Kitty” on YouTube and “DeepFuckingValue” on Reddit, made a comeback in May 2024 with a post on the X platform (formerly Twitter). His return sparked a massive rally in GameStop shares, doubling within a few days. The GME memecoin on the Solana blockchain also surged by over 3,000 percent within 24 hours. News Alarms reported the recent gains, leaving many investors in a frenzy, suggesting history may be repeating itself.
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A Look Back: GameStop’s 2021 Rally
In 2021, GameStop experienced three major price hikes, driven by retail investors coordinated efforts against hedge funds. These “short squeezes” propelled the stock price from a few dollars to over $400, as short sellers were forced to buy back their positions to limit losses. In May 2024, a similar pattern seems to be unfolding, but at a much faster pace. What took six months in 2021 is now happening in just three months. Mid-May saw GameStop’s share price double in two days, fueled by speculation about Keith Gill’s return, a central figure in the 2021 rally.
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Community Support and Legal Challenges
The success of GameStop and Roaring Kitty can be largely attributed to strong online community support. Platforms like Reddit and X play a crucial role in spreading information and coordinating buying actions. Despite recent price surges, Keith Gill is currently facing a class action lawsuit for securities fraud. However, his lawyers are confident the lawsuit will be dismissed, and the community continues to rally behind him despite legal challenges.
Is Another Short Squeeze on the Horizon?
Recent price actions suggest GameStop remains on a positive trend after surpassing the $28 mark. Reports indicate a significant number of call options speculating on future price increases, with nearly 75,000 calls at the $30 mark. This speculative activity could trigger another short squeeze, forcing short sellers to buy back their positions, driving the stock price even higher.
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Market Data and Future Prospects
Recent data shows significant increases in trading volume and market capitalization for GameStop. Signs of gradual purchase accumulation could indicate a larger move ahead. When investors continue to build positions, it’s often a positive sign for future price movements. Additionally, the GME memecoin has regained value, rising nearly 3 percent in the last 24 hours at the time of writing, though still about 79 percent below its all-time high from early June. If GameStop stock overcomes new resistance zones, it could positively impact the GME memecoin.
Outlook and Conclusion
The hype around GameStop and Roaring Kitty shows no signs of fading. Conditions appear favorable for another short squeeze, potentially forcing short sellers to close their positions, driving the price even higher. However, investors should remain cautious, keeping an eye on the risks and the volatile nature of these investments.
