GameStop Stock News and Forecast: Ryan Cohen buys more GME shares

GameStop stock surged over 30% on Tuesday.
AMC stock is also on a high as it spikes 15%.
GME stock ramps up on Wednesday as Ryan Chone steps in.

Ivan Brian FXStreet

GameStop stock (GME) rallied an impressive 30% on Tuesday as retail investors piled back into some of their old favorites. AMC for example closed up 15%, and other meme and retail favorites also performed strongly. This move into risk assets has been set in motion by a strong Fed statement last week when Chairman Powell said the US economy was strong enough to withstand rate hikes and he saw continued strength in economic growth and employment. Investors seem to believe in the Goldilocks scenario painted by the Fed – that of a soft landing and control of inflation. A quick look back through history predicts this is highly unlikely. Inflation is usually not brought under control by rate hikes but by recessions. Nevertheless, we must trade what we see, and for now risk assets are definitely in favor. The key is to remember when this trend slows and then to book some profits.

GameStop Stock News: Share price up again on Ryan Cohen purchase

GME stock, not content with a 30% surge on Tuesday, is up a further 15% on Wednesday as news hit of CEO Ryan Cohen's RC Ventures buying 100,000 shares in GME. This takes his stake in the retailer up to 11.9%. Jim Cramer of CNBC was certainly getting in on the act as he tweeted:

He also invited Ryan Cohen to his show to discuss BBBY and GME, saying he will give him ten minutes on each. This refers to Ryan Cohen taking a recent stake in BBBY through his investment company earlier this month. BBBY stock spiked sharply on the news to $30 before quickly retracing to $20. So will it be the same for GME? Insider buying is generally a stronger predictor of future performance than insider selling.

GameStop Stock Forecast

This has certainly changed the technical picture. GME stock was suffering along with many techs and growth stocks in 2022. The recent recovery saw GameStop once again top the WallStreetBets chat and discussion of another short squeeze were high on the wish list of traders. GME rallied 30% before this news of Ryan Cohen. Now the move has taken GME back up to $140, clearing the congestion zone from $120 to $130. $140 is also the top of the Ichimoku cloud. The next big level comes at $160 from the series of highs in December and $174.78 from the spike high in January of this year. Key support is at $100 – the breakout level.

GME 20-hour chart

Author

Ivan Brian

FXStreet

Ivan Brian started his career with AIB Bank in corporate finance and then worked for seven years at Baxter. He started as a macro analyst before becoming Head of Research and then CFO.

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