GameStop Out of Stock Alert: Is GME Back?

NFT rumors drive GME shares higher on Monday.
GameStop loses a senior executive as the COO leaves.
GME shares jumped 8% on Monday despite news from the COO.

GameStop Escape Alert (GME)! Is the stock of original memes back? The stock certainly made its way yesterday with an increase of more than 8% to get it out of the sleep zone and come back to the attention of retail traders. In percentage terms, GameStop has now turned positive for the past month and looks set for more gains as it signals a breakout, which we’ll discuss later.

GME 15 minute chart

GameStop stock market news (GME)

So why move on Monday? News of the departure of an COO was generally viewed as negative, especially since she had not been in the job for a long time and had a lot of experience. Jenna Owens agreed to leave, according to GameStop, just seven months after arriving. She had been a senior executive at Amazon (AMZN) and Alphabet (GOOGL). There weren’t many more details except that she was due to leave immediately (in fact, she left on October 25) and that a separation agreement was in place.

On Monday, however, GameStop jumped more than 8%. Various social media sites are talking about a potential pivot in the non-fungible token (NFT) industry for GameStop, and discussions increased significantly on that front over the weekend. NFTs are seen as a lucrative side business for GameStop (GME).

Gamestop Inventory Forecast (GME)

Both positive and negative news flow is then evident, but the simple fact is clear from the chart below that this is a breakout game with momentum traders rolling next. behind the movement. Witness the contraction in volume and price resulting from the formation of the triangle that we see in the GME chart below. Triangles almost always lead to a breakout, and that is clearly what we have. GameStop also found support for the 200-day moving average perfectly, so keep an eye on that for future reference. The target is the size of the entrance to the triangle, which is around $ 260. Note that no technical analysis is frozen. These are estimated targets based on escape theory. Key support is the breakout level at $ 183. Holding $ 183 keeps the GME stock bullish, but below it and it reverts to neutrality. Resistance is at $ 231, the top of the triangle and the September 1 high. The RSI was also well above 50, adding to the confirmation bias.