Gamestop Stock Fakes A Breakout, But Doesn't Look Done Yet

Gamestop Corp. GME shares were trading lower Tuesday as many retail stocks take a hit due to concerns over the COVID-19 omicron variant.

The stock is holding above support in a technical pattern and could see a push higher if the trendline continues to hold.

Gamestop was down 2.86% at $196.21 at the close Tuesday. 

Gamestop Daily Chart Analysis

• Shares look to be forming into what technical traders call an ascending triangle pattern, as it has been able to hold above the higher low trendline.
• The stock has been holding above the higher low trendline and is pushing higher up toward the $230 level, as this level has held as an area of resistance in the past. If the stock can push above this level the next level of resistance may be found near the $350 area.
• The stock trades above both the 50-day moving average (green) and the 200-day moving average (blue), indicating the stock is seeing bullish sentiment.
• Each of these moving averages may hold as a possible area of support in the future.
• The Relative Strength Index (RSI) has been falling lower the past few days as the price has cooled off and now sits at 46. This shows that more sellers have moved into the market, and now selling pressure outweighs the buying pressure.

What’s Next For Gamestop?

Bullish traders are looking to see the stock continue to hold above the higher low trendline and push up toward the resistance level. Bulls are then looking to see the stock break above the resistance line and see a period of consolidation for the stock to possibly see a further bullish push higher.

Bears are looking to see the stock fall below the higher low trendline and be able to hold below it for a possible breakdown. A push below this higher low trendline may hint the stock is in the beginning of a downtrend. Bears are also looking to see the stock fall below the moving averages for the stock to see a possible strong bearish push.