GME股東大會重磅嚟啦，掀起Meme股新熱潮？
【Investment fever】GME gains twice in one month! How do I get to grips with the next move?
* This article was first published on May 15 and updated on June 4.
Before the US stock market on May 14, three weeks ago,$GameStop (GME.US)$WHILE MEME SHARES EXPERIENCED A HISTORIC SURGE, GME GAINED CLOSE TO 160%. Although the share price fell in the subsequent trading day, GME showed another big rally on June 3, peaking at 75% after opening and eventually closing up 21.00%.
What is the logic behind the two big gains? In the face of this large volatility, how to better master the movement with techniques? In the face of various market hotspots, how can you use tools to move faster in the market?Ox sir will tell you one by one below.
1. The Logic Behind Two Bullish Rises
GME is a very typical MEME stock. First of all, please explain what a MEME stock is.
MEME STOCKS ARE THOSE STOCKS THAT ARE SOUGHT AFTER BY RETAIL INVESTORS ON SOCIAL MEDIA AND CAN EXPERIENCE SHARP PRICE CHANGES IN A SHORT PERIOD OF TIME.
These share price fluctuations are usually not directly related to the fundamentals of the company, and these stocks may also be highly depleted by institutional investors in the past. But as retail investors chase, or a story of a company turning upside down, the stock price moves from undervaluation to a rapid rise, after which the market overheats and eventually falls.
Also important: Due to the high volatility in the short term, it is possible to trigger a short squeeze. That is, as the stock price rises rapidly, investors who empty the stock may be forced to close their positions (i.e. buy the stock to reduce losses), which will further push the share price higher.
The WSB flagship concept block on Futubull, which brings together one such stock,Click hereOr go to view the image below.
*WBS is short for WalllStreetBets, a well-known community on Reddit forums, where WBS investors love MEME stocks (myth stocks) and blue chip stocks.
SO WHAT TRIGGERED THE MEME BOOM IN MID-MAY?
This is to say Keith Gill, the American wholesaler who drove the stock price of Wall Street and explosive gaming stations in 2021. That year, he made a massive splash in the forums of the social networking site Reddit, bringing together retail customers around the world and driving up the gaming station's stock price.
In January 2021, the gaming site's stock price rose from $20/share to $40/share, and then rose further to an all-time high of $483/share, triggering 17 meltdowns (an empty short squeeze occurred as the stock price continued to rise). The war caught the attention of government agencies as retail trading was restricted and stock prices began to fall to lower levels. After this incident, Keith Gill went silent.
Three years later, on May 13 (Eastern Time), he again posted hints on social media hinting at a comeback, a news that sparked widespread investor attention, sparked by MEME's surge this time.
What triggered the June 3 rally?
Keith Gill recently posted a screenshot of GME's holdings on Reddit, showing a large number of GME shares and their CALL subscription options.
Meanwhile, Keith Gill's opponent, founder of Citron Research, Andrew Left, once suffered a major loss in 2021 due to vacating GME, also decided to do it again after seeing Keith Gill's post. Renowned investor Yongping also made a deal on Snowball to make a void GME subscription option.
The relaunch of the multi-space war could cause further volatility in GME's share price, and regulators may also keep a close eye on GME's trading activities, and the aftermarket is full of uncertainty.
2. How to seek opportunities at risk through tips?
For stocks with such high volatility,To help everyone better look for opportunities at risk, bullsir shares some tips from two angles, on the one hand, on how to determine the subsequent movement of these stocks and on the other, how to identify potential MEME stocks.
A. Let's talk about 2 techniques for judging the next move.
Such sharp price rises, often accompanied by an increase in trading volume, may provide further support for the share price if the volume can be sustained.Conversely, if trading volume begins to decline markedly, the share price rally may not continue.
From the chart above (before the US stock close on June 4), GME's trading volume has recovered after the surge, but remains at relatively low levels. If you go further, you will find that although the money appears to be a net inflow, the phenomenon of increased short selling also hints at the risk of falling stock prices.
For this stock that is rapidly rising in price, sir bulls would also like to recommend a good tool for finding support and resistance levels: the Fibonacci Retracement.
By selecting the start and end points on the stock price chart, a set of horizontal lines is formed, including ratios of 23.6%, 38.2%, 50%, 61.8%, 100%, etc. If the stock price gains support and rebounds on a Fibonacci level, it may indicate that the uptrend is still valid. However, if the share price falls below all the levels, especially the last 38.2% or 23.6%, it may indicate that the uptrend is losing momentum, and the market may fall further.
On Futubull, you can find the entrance to the painting Fibonese bull by identifying the pen on the upper right of the image. FROM THE ABOVE CHART, GME'S SHARE PRICE FELL JUST ONE STEP AWAY FROM ALL HORIZONTAL LINES BETWEEN 23.60%-38.20% BEFORE THE OPEN ON JUNE 4. However, this is just providing some kind of reference and analyzing it in combination with other technical indicators, so that you can get more indicative information for investing.
B. LET'S JUST SAY HOW TO IDENTIFY POTENTIAL MEME STOCKS.
In addition to following the heat on social media and looking for MEME stocks with backfiring stories, bull sir recommends one more trick for everyone, which isTake a look at the stock's headcount。
Generally speaking, if the holding ratio is higher than 40%, it indicates that the stock is highly deflated. Then once the stock price rises sharply, it can lead to a short squeeze, which will push the stock price higher.
Of course, the bull sir is still warning of risk: MEME stocks fluctuate widely and quickly. If the share price is already in the late or profitable phase, it may have been severely overvalued. Buying at this time can be very risky.
*All of the above images are for investment education purposes only and do not represent any investment advice.
3. Faced with the rapid fluctuations of the market, how can one step faster?
Based on the above case, you are sure to feel the speed at which the market moves directly. Some mooers may learn to trade only on the counter, and before, and after the night slots may come up with the stock price boom.
Then I'll recommend it to you, sir.Futu's 5X24 hour trading featureThat's it. 5 trading days a week, you can trade anywhere and anytime in Futu, this featureHelp you catch trading time at a fast pace when the market fluctuates fast!
How to use? The video below will give you guidance,Click hereYou can also go directly to the “List of stocks that support night trading” page.
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*Event Target: Participation of Special Depositary Users in Hong Kong Region who have registered Futu APP for over 18 years with unregistered securities accounts
Risk Disclaimer: The above content only represents the author's view. It does not represent any position or investment advice of Futu. Futu makes no representation or warranty.Read more
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