GameStop's Downward Trend Continues: Will Key Support Zone Hold?

GameStop Corp. GME shares are trading lower Monday and near a possible area of support.

Gamestop is planning on releasing an NFT marketplace with Immutable IMX/USD. Meanwhile, the chairman of the board of the video game retailer, billionaire investor Ryan Cohen, has taken a 9.8% stake in Bed Bath & Beyond Inc. BBBY.

GameStop was down 10.10% at $100.38 at time of publication.

See Related: Immutable Gets $200M In Funding Ahead Of GameStop NFT Marketplace Launch

GameStop Daily Chart Analysis

• Shares are seeing a strong bearish day and are falling closer to support in a sideways channel. The stock has been able to find support near the $86 level in the past and could again in the future. Resistance can be seen near the $230 level, as this has been a place where the stock has struggled to cross above in the past.
• The stock trades below both the 50-day moving average (green) and the 200-day moving average (blue). This indicates bearish sentiment, and each of these moving averages may hold as an area of resistance in the future.
• The Relative Strength Index (RSI) has been falling the past few days and now sits at 37. This shows that sellers have been moving into the market and now there is more selling pressure than buying pressure. If this selling pressure continues, the stock may see a break below support.

What’s Next For GameStop?

GameStop is seeing some bearish momentum and hasn’t been able to see bullish momentum in a while. GME is nearing an old area of support, and whether the stock bounces or falls through the support may help predict where it goes next.

Bullish traders are looking to see a bounce off the $86 support level and see the stock begin to form higher lows and cross back above the moving averages.

Bearish traders are looking to see the stock fall below the $86 level and be able to hold it as an area of resistance. This could bring about a further bearish push in the future.

Photo: Courtesy of Dicoplio Family on Flickr