GameStop Stock Price and Forecast: A not so happy birthday for GME

GameStop stock marks the anniversary of its surge.
GME traders circulate birthday wishes on social media as CEO Ryan Cohen joins the tweet celebrations.
GME stock falling but still up over 200% from this time last year.

Ivan Brian FXStreet

GameStop (GME) celebrated one year from its hectic heyday this week as the stock initially surged this week last year. GameStop was the original of the meme stock species and spawned many children, most notably AMC. Many have totally retreated but others have held some of their gains over the last year if not being quite at their all-time highs. GME for example is still up 200% from the initial pump, while AMC is up a more impressive 840% from this time last year. Other names have not been so lucky. Virgin Galactic (SPCE) is down 70%, while BlackBerry (BB) is more or less flat from a year ago.

GameStop Stock News

The birthday news is about as exciting as it gets for the stock. That is the problem. Meme stocks need news flow and momentum for them to thrive. This has been steadily drying up. Many have turned to hot sectors like crypto and NFTs to try and maintain momentum, but this is failing. GameStop is trending on social media due to the birthday, but this has not resulted in a follow through for the stock price. Call option volume is decreasing steadily as is normal trading volume across the exchanges in most meme stocks. Momentum is drying up, so we anticipate further losses for the share price of GME and other meme names.

GameStop Stock Forecast

Nothing has changed our view with the double top starting the most recent downtrend and the $118.59 support really the last change. Break this and the move is likely to extend to $70, with some support at $86 along the way. $86 is the retracement from last February.

Breaking the $160 to $167 resistance area will provide an end to the bearish trend, but with a crossed Moving Average Convergence Divergence (MACD) indicator and declining Relative Strength Index (RSI) as well as falling momentum, FXStreet remains bearish.

GameStop (GME) chart, daily

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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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