GameStop’s Wild Ride

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Hey everyone, Ross Cameron here! Today was a rollercoaster for GameStop, jumping up 69% this morning, hitting a high of over 100%. As a day trader, I couldn’t help but dive into the frenzy. What drove this massive surge? Let’s take a look!

The Catalyst: Roaring Kitty’s Meme

In 2021, GameStop became the poster child for meme stock trading. This time, the spark is a meme posted by Roaring Kitty on Twitter. The meme suggested that “things are getting serious”. With 116 million shares traded, GameStop surged 70% on that meme alone.

Initially, I felt this wouldn’t be another 2021. The big money shorts are prepared and know the tricks to keep the stock controlled. They did it once; they can do it again. My gut told me this surge would eventually fade.

Technical Analysis

I pulled up the daily chart to see where GameStop stands. They did a 1:4 stock split, so the new high is $120 (pre-split $500). We’re still far from those 2021 highs.

The 200-day moving average is a significant marker. GameStop was above it at $23 a share, but has dipped below it several times. It doesn’t mean much alone but is worth noting.

Pre-market, there were many sellers at $25. On the Level 2 data, sellers were stacked there, making it a tricky spot for buying.

I noticed a big hidden buyer at $26.20, absorbing shares. This built some confidence in a potential breakout.

GameStop had five halts on the way up. These halts are due to extreme volatility, a common sight in meme stocks.

The stock made an impressive red-to-green move. It opened lower, bounced, and surged higher, actually hitting five halts up before its first downside halt.

Risk Management

Trading high volatility stocks like GameStop can be risky. They can drop fast, leading to significant losses. I prefer lower-priced stocks with clear news-driven catalysts. It’s easier to manage risk and avoid massive drawdowns.

At certain points, I chose to sit on the sidelines. This market can punish poorly timed trades. Staying disciplined is crucial.

Today ended with a small profit of $555. It’s easy to get greedy, but staying disciplined paid off.

Gratitude and Avoiding Comparison

While $555 may seem small, it’s still a win. Comparing myself to traders who made thousands leads to unnecessary frustration. Staying focused on my own journey is key.

Trading involves a lot of psychology. It’s easy to get caught up in FOMO (fear of missing out). Today, I avoided that trap by sticking to my plan and not chasing moves.

Last Monday was rough, but since then, I’ve had five days of disciplined trading. I aim to keep this momentum.

Focus on the process, not the profits. I have found that when I get the process right, the money follows.

Final Thoughts

Today was a wild day for GameStop. From Roaring Kitty’s meme to multiple trading halts, it was a trader’s dream and nightmare rolled into one. Staying disciplined and managing risk is crucial. While today wasn’t a massive win, I managed to stay disciplined so it was a step forward in my journey of day trading.

I’ll be back at it tomorrow, ready for whatever the market throws my way. Remember, trading is risky. Always manage your risk and take it slow. Happy trading!

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Warrior Trading was founded by Ross Cameron in 2012, and is now a thriving community of thousands of traders. You can learn more about joining the Warrior Trading community here.

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