The GameStop stock price is perilously close to major support. Therefore, we highlight the key technical levels that all GME traders should be aware of.
GameStop Corp (GME: NYSE) closed at $210.88, down $0.38 (-1.18%.
GME has flatlined lately and spent much of the last 2 weeks in a $30 range between $200 and $230. While a 17% range could be considered normal, even high, for many stocks, we are talking about GameStop, which had a 2,800% range during 2 weeks in January.
GME was used to being the number one topic of conversation on the retail investing Reddit sub, Wallstreetbets. Of course, AMC took the title earlier this month. Although lately, both AMC and GME have lost ground to newcomers. Moreover, the excitement surrounding GME starting to dissipate.
SOFI Technology Inc is by far the most talked-about stock on WSB and 25% of all activity. Closely followed by Clover Health at 15%. Sentiment checker Swaggystocks shows that GME only accounts for a tiny 3.45% of mentions.
Furthermore, the recent price action has seen the GameStop stock price stock treading water above a key support area. So on that basis, now would be a good time to take a look at the technicals.
The daily chart shows several clear support levels, followed by an obvious resistance level. However, what’s interesting is the major moving averages reinforce the validity of the support.
Firstly, the March $348.50 high is the first significant resistance level. A close beyond this would open the door to January’s $485 peak.
The closest and maybe the most important support is seen at $200. The starting point of ascending trend line from February at $40 marks the beginning of the short-squeeze to the March high. This is now seen at $199.70.
50-day moving average: $200.33
The second horizontal support at $172 can be traced back to March, when GME bounced twice after almost pinpoint touches.
100-day moving average: $172.39
Finally, comes $101. This level was the low of the intraday correction on February 25th. Furthermore, it was within $0.70c of Feb 26th’s closing price of $101.70.
Additionally, the 1st of March low was $99.97. From there, GME rallied for 7 days straight, gaining 245%.
200-day moving average: $101.07
To conclude, although investors must now broaden their spectrum of inputs when picking stocks. The tried and tested old school methods most definitely have a part to play.
Follow Elliott on Twitter.
