bestcryptogamesandroid| GameStop suspended trading twice, and surged 80% after resuming trading. Is the "leading brother" of retail U.S. stocks coming back?

SourceBestcryptogamesandroidZhao Ying on Wall Street

Will the retail frenzy of US stocks make a comeback?

Will the return of "leading Big Brother" trigger a comeback of meme stocks?

At the start of trading on Monday, the game station triggered a circuit breaker, up 54% before suspending trading, and the share price continued to rise more than 80% after the resumption of trading.

Before the US stock market, GameStop soared by more than 40% in the absence of major news, a frenzied scene reminiscent of the fierce sawing of GameStop by investors and short sellers in "retail vs. short" in 2021.

The catalyst for the GameStop rally was Keith Gill, code-named "Roaring Kitty", posting on social media site X, amid widespread speculation about its return.

The post shows a man leaning forward with what looks like a game controller. Some traders think this means that Gill is about to move again. Gill, whose account has been dormant for a long time, shot to fame by calling on short-term traders to short GameStop on Reddit in 2021.

X users were ecstatic about his return. The post received more than 9 million hits within hours of posting, and some users said GameStop had not been sold.

Although GameStop shares are far from returning to their 2021 peak, the stock has soared more than 70 per cent in a month on the latest wave of retail buying.

GameStop still faces high short pressure, doubling from 25 million shares at the end of 2021, equivalent to 24 per cent of outstanding shares, well above average, and similar to the rally in 2021, when GameStop soared more than 1600 per cent in January, bringing the meme craze into public view.

Hedge funds shorting GameStop have been hit hard by short selling by retail investors. At present, short pressure remains high, which makes it possible for GameStop shares to continue to soar.

But the boom may come to an abrupt end at any time, GameStop continues to face severe fundamental dilemmas, this surge is even more lack of fundamental catalysis. The enthusiasm of retail investors is often unsustainable, as they can quickly embrace a single stock, or they may quickly abandon it.

Meme shares and other unprofitable companies have been dormant since the collapse in 2022, mainly because of the tightening of financial conditions caused by the Fed's Powell rate-raising cycle. will the upcoming rate-cutting cycle start some kind of recovery?

For now, meme shares seem to be making a comeback. In addition to GameStop, shares of AMC, a chain of cinemas favored by retail investors, rose 17% on Monday.