== Neural Market Trends ==

The Meme Stocks GME, AMC, and BB

Investing Trading Stocktwits

I’m still in awe watching retail traders en masse push these stocks to highs or even new highs. It all started with Gamestock (GME) a few months ago and I was lucky enough to ride the wave for two days and GTFO. My wife wanted a piece of the action, despite my warnings, and bought a few shares at $350. It went to $500 in pre-market trading the next day and then promptly collapsed.

GME Stock

Over the past few trading sessions, GME has been moving higher. My wife is eyeing an exit if it hits around the $350 for essentially a ‘scratch loss.’ If it gets there.

If it gets there she should consider herself lucky considering how many faces GME ripped off in February. No matter how many ‘stonks go up’ and ’stick it to the Hedge Fund guys’ retail traders there are, you can’t escape the fundamentals. Maybe in the short term, you can be divorced from reality but in the long run? My analysis shows that the median value of GME is about $13.

Take a look at this week’s retail trader du jour, AMC.

AMC Stock

The big boys got caught in a nasty short squeeze here and to be honest, it’s kind of fun to watch. Still, though, AMC has an $11.7 billion market capitalization today. Compare that to just over a year ago when it was $225 million.

Crazy, right?

My analysis shows that AMC’s median share price is about $10, so $50+ share price is nuts. Utter freaking nuts, but the market wants and the market gets, right?

What about BlackBerry (BB)? How’s that doing? Lately, there’s a bit of a move higher as people start piling into the meme stocks again.

BB Stock

Right now my share price analysis points to a median price of about $9, so at $15 it’s not quite double that yet. It sure sounds like a deal, doesn’t it (j/k)?

The thing is with these meme economy stocks is that there will be bagholders. Once the meme story is over there will be too many retail investors that will have lost life savings, stimulus checks, and gotten too heavy into debt.

I completely get it, it’s a thrill to ride this high and I sound just like an old man yelling at the kids to ‘get off my lawn’ but there’s no fun in blowing up. Believe, I’ve blown up plenty of personal trading accounts and had to go back to working jobs I didn’t like.

Stay safe out there…

Learn Stock Trading, Investing, and Risk Management

There are a handful of financial and trading books that have made a HUGE impact on my investments. If you want to trade and learn about money and risk management then I suggest you get the Van Tharp book. If you want just focus on long term investing, get the Random Walk Down Wall Street book.

Hell, get them both. I owe my wealth to what I learned in those books.

comments powered by Disqus