GameStop shares saw huge increases from around $40 a share to $117 by Jan 25 around noon. The stock died down the following day, to the low $90s. Later on in the day, Elon Musk tweeted the WallStreetBets reddit forum, with the caption "Gamestonk. This prompted $GME to rally after market, to around $352 a share, more than a 100% increase.
So what exactly is happening? Basically, Wall Street believed GameStop is not worth $30 a share, so they decided to short the stock. Shorting a stock is when you believe the price of a stock will go down, so you get money whenever the stock falls. However, retail investors from r/WallStreetBets were having none of that, and decided to pump the stock up instead. This is what's known as a short squeeze.
A wide range of Investors, from Youtube Gurus to average Joes are speculating that $GME has the potential to reach highs of $1000 a share, and other shorted stocks such as $AMC and $BB can have a similar pattern.
I don't believe $GME will go to $1000, but I do believe it still has room to balloon. This Friday, the big Investment Firms will have no choice but to close out their position if $GME fails to drop. This would mean the price of $GME will strike higher once again. Currently, I do believe that these firms are utilizing all means possible to try and shift the discussion from $GME to other stocks in hopes of driving down its price. As one redditor pointed out, short sellers are trying to get $GME investors to take profits in an attempt to drive down its price. However, if everyone stays on board and HOLD, this strategy will not working, furthering damaging the firm's chances of success. If these retail investors can hold until Friday, It is a big possibility that $GME will once again shoot up, for, in my opinion, it's last time.
UPDATE:
As of January 28th, Robinhood has suspending buying of shares in specific stocks such as $GME, $AMC, and $NAKD. Robinhood is still allowing users to close their positions in these stocks, but additional purchasing of shares is restricted.
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