GameStop Shares Outperform Bitcoin: Altcoin Market Anticipates Possible Surge
Summary:
Yearly returns of GameStop shares have exceeded those of Bitcoin within a day, reigniting speculation about potential investment in the altcoin market. Analysts note that during the 2021 cycle, the altcoin rally was reportedly triggered after the GameStop short squeeze. This sudden surge coincides with Keith Gill's return to social media, who is widely recognized as a key player in the 2021 GameStop saga. With market conditions for altcoins resembling the 2021 setup that fueled their bull run, some experts expect altcoins to hit their local bottom by early June before a potential season of growth.
In a single day, the yearly returns of GameStop shares have overtaken those of Bitcoin (BTC), sparking speculation as to whether part of these profits could be funneled into the altcoin market. Over the past year, GameStop's returns have surged by more than 154%, dwarfing Bitcoin's yearly returns which are just over 129%, based on data from TradingView.
Most of this increase in GameStop's returns was witnessed in the last couple of days. For instance, on May 14, GameStop's share price witnessed an increase of over 105% by 2:35 PM in UTC timezone. Trading began to gather steam on May 13, when Keith Gill, the individual most commonly associated with instigating the 2021 GameStop short squeeze, made a surprising reappearance on social media following a near three-year hiatus.
During the height of the COVID-19 pandemic, Gill found himself at the heart of the GameStop frenzy. This involved retail traders overcoming hedge funds that shorted the stock, leading to a monthly surge in GameStop's share price of over 1,000%. In the 24 hours that followed Gill's comeback, GameStop shares surged by as much as 111%, while Dogecoin (DOGE) and the Shiba Inu token (SHIB) rose by 6.2% and 5.4% respectively.
Could the reemergence of the GameStop saga ignite a rally in altcoins? During the 2021 cycle, the surge in altcoin prices was triggered shortly after the GameStop short squeeze. Crypto analyst CryptoAmsterdam pointed out on May 14 that altcoin rally immediately followed the GameStop surge back in 2021, emphasising the importance of money flow.
According to CryptoAmsterdam, the current market capitalization of altcoins mirrors the 2021 setup that fueled the bull run in altcoins. Meanwhile, analysis by Rekt Capital expects altcoins to hit their local bottom by early June, just before the altcoin season kicks off. Some memecoins, have already gained momentum in response to the GameStop saga, with Pepe (PEPE) reaching a new all-time high of over $0.000010 on May 13, just a day after Gill's return.
However, there are subtle differences in the investment landscape this time around. eToro market analyst Josh Gilbert notes that the number of outstanding shorts on GameStop is significantly lower than during 2021, which could limit any potential upside movement. Gilbert further highlighted that current circumstances differ considerably from 2021 when fiscal stimuli were being provided globally, interest rates were at their lowest, and large economies were experiencing minimal inflation. This article does not provide investment advice or recommendations. All investment and trading activities involve risk. Readers should conduct independent research before making any decisions.
Published At
5/14/2024 8:07:02 PM
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