Is GameStop GME About to Crash?

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 "GameStop is a way overextended pile of shit"

- Billionaire short seller, circa December 2020


UPDATE 8:40PM CST

Sources say one hedge fund, Melvin Capital, will announce bankruptcy as a result of this short squeeze



GameStop GME is a masterclass in stubbornness. 

Apparently, some big hedge funds are blowing up right now shorting this monster rocket headed to the moon. These hedge funds may be right, GME is a pile of garbage, terrible fundamentals, even worse outlook, and only get rich quick r/WallStreetBets autists are holding it up.


However, so-called institutional Wall Street veterans are failing rule #1 in investing: trade price, price pays, not your ego.

And these clowns rake in tens of millions in fees from their clients. I don't know about you but I'd be super pissed if I was paying a moron to short GME and not cut his/her losses when the price is telling them to cut their losses.

Anyway, diatribe aside. Let's focus on where GME goes from here.

GME is already up about 45% after-hours. 

What do the charts say about GME? Let's start with the daily.

The daily chart is in a strong bull trend with no evidence of a reversal...yet. Yesterday did show a massive range and selloff of about 50% intraday. That's massive and could've been the catnip/bait to lure in more short-sellers and entice current short bagholders to double down. 

And that's apparently what they did. Short interest stayed steady yesterday at about 139% of the float, which is illegal is it not?? Whatever...


Okay, what about tomorrow? Is it too late to get in?

Well, I bought GME near the close today at about 140 because I expect it to go parabolic tomorrow for two reasons.


1) GME held a decent bull trend for the first half of the day then accelerated, indicating people NOT getting scared, except perhaps shorts trying to cover, but instead, more buyers coming in. This is despite the big range yesterday. It fazed no autist r/WSB longs. In fact, they bought more today.

2) There was no breakout today above yesterday's high, which would have triggered some shorts to capitulate. Instead, they are left holding their shorts overnight and hoping for a gap down crash tomorrow. Well, the longer you are in this business, you know anytime hope is involved, you should probably run for the hills. As I pointed out above, that's exactly what happened. GME was up 50% at one point after-hours tonight. That's a massacre that only begins tonight and potentially goes full tilt tomorrow, at least in my dumb opinion. 

Well, that wraps up this post. If you have any questions about GME, let's discuss them in the comments below.


Cheers

Jory



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