GameStop (NYSE:GME) continues to cool following a trading frenzy that drove shares up by 75 percent between the close of trading last Friday (May 31) and the start of trading on Monday (June 3).
The brief rally, which took GameStop shares to US$40.09 on Monday morning, was sparked by a Reddit (NYSE:RDDT) post made late Sunday (June 2) by an account tied to the video game retailer's most prominent supporter, Keith Gill.
Gill, who ignited the meme stock craze in 2021 and is known as Roaring Kitty on other platforms, posted a screenshot on Reddit's Superstonk subreddit that shows a purported US$175 million position in GameStop shares and call options.
However, late on Monday, concerns arose when the Wall Street Journal reported that there had been discussions among executives at Morgan Stanley's (NYSE:MS) trading platform E*Trade about a potential ban on the trading account that is believed to belong to Gill. It remains to be seen if E*Trade will remove the account from the platform.
Gamestop’s share price closed Monday at US$28, up 21 percent over the prior trading day, but moved down 5.5 percent through Tuesday’s (June 4) trading session to close at US$26.50.
This recent surge marks the second time in a month that GameStop has experienced such frenzied activity. In mid-May, Gill's return to the social media platform X, formerly known as Twitter, drove the stock up 180 percent over two days.
Back in 2021, GameStop's share price surged as high at US$86.88 in a coordinated short squeeze.
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Securities Disclosure: I, Giann Liguid, hold no direct investment interest in any company mentioned in this article.