The frenzy surrounding Gamestop and AMC has extended into the realm of crypto, meaning that the recent correction in GameStop shares could trigger corrections across multiple meme coins as well.
After creating a massive frenzy earlier this week, the share price of GameStop Corp (NYSE: GME) has come under severe selling pressure. On Wednesday, May 15, GameStop stock price tanked 18.87% dropping under $40 by the end of the day.
In pre-market trading on Thursday, GameStop shares are experiencing a significant decline, amplifying losses incurred from Wednesday’s downturn. Currently, the GME stock price is down by an additional 16% with its price dropping to $32.20 in the pre-market trading.
The recent market movement contrasts with the substantial $9.6 billion increase in market value witnessed on Monday and Tuesday. This surge followed activity on an X account linked to Keith Gill, a figure instrumental in drawing attention to GameStop in 2021, posting for the first time in nearly three years.
The rally in GameStop and AMC also triggered a massive surge across the entire cryptocurrency meme coin sector. As per data provided by on-chain data provider Santiment, notable assets such as $PEPE (+100%), $PONKE (+96%), $MAGA (+80%), $TURBO (+78%), etc. have experienced substantial gains. Just over the last week, the trading volume across the meme coin sector has shot up by a staggering 136%.
However, as the GameStop party ends, investors playing in the meme coin sector should be careful from taking up new bets at this point.
Will Meme Coin Party End Along with GameStop?
The frenzy surrounding Gamestop and AMC has extended into the realm of crypto, largely driven by their speculative appeal. Currently, these two companies dominate discussions on cryptocurrency platforms, emerging as the most trending topics within the community.
Thus, the pullback in meme coins is very much likely following the pullback in GameStop. The Solana-based GameStop ($GME) meme coin which rallied over 4,400% this week, has also tanked by 46% in the last 24 hours. with its price slipping under $0.01. While there have been talks about the GameStop ($GME) meme coin price reaching $1, it looks to be a distant dream as of now.
.@TheRoaringKitty's return has the crypto community buzzing about #memecoins! While some #altcoins may thrive, others might not. $PEPE, in particular, seems poised for a retrace.
The TD Sequential shows two sell signals on the #PEPE 3-day chart: an aggressive 13 and a green nine… pic.twitter.com/9spYZnQ1LO
— Ali (@ali_charts) May 16, 2024
PEPE Coin, which touched its all-time high earlier this week, is currently down by 6% and trading at $0.00001041. On the PEPE 3-day chart, the TD Sequential indicates two sell signals: an assertive 13 and a green nine candle. Furthermore, there’s a noticeable bearish divergence between the price movement and the RSI.
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