What's going on moong, this episode of dumb money will be your weekend update on gamestop in this video, of course, we'll be going over a quick technical breakdown, we'll be looking at the short interest numbers, and then i really want to dive into two interesting things that I saw before the market closed on friday for gme just for a bit of foundation, jimmy closed out at 209 51 for the fourth trading week in june. So now, let's hop right into it. This is the daily chart of gamestop. This is how we're looking over all of 2021, we shot up in that first huge storyline at the end of january, we came down and then after there in mid-march, we hit this and then all the way fast forward to mid-june.

We hit it again so now we're kind of on the bigger time frame, looking at potentially a huge cup and handle here would be the cup one giant. U and then the handle would be where you don't go as low and when i'm referring to as low kind of around 130, this time we're basing around 200. So i'm looking for the follow through, hopefully it bounce very, very soon, so we get that handle and then we would have a perfect cup and handle. And honestly, if you crack open any technical analysis book, it will tell you that the cup and handle technical structure is a bullish.

One now is that guaranteeing that it will come to fruition and explode from there. No, but it's kind of telling you that the the deck is stacked in your favor. So that's how we're looking from the start of 2021. Until now, and in fact from that moment we are up over a thousand percent if we zoom in just a little bit so this trend line i have on the bottom is the trend line that we've been following since the end of february.

There was a fake out breakdown in mid-may, and then we exploded back up to fill out that overall cup and then there was the announcement that gamestop will be doing an at the market offering of 5 million shares. Obviously, markets don't really react too. Kindly to that, but it was announced that it was completed on june 21st and then from there the next day we got back above this trend line and now that's where we're still battling it out. But as i'm about to dive into later in this video, there is something else going on in the background.

So, from a technical perspective, we are looking for this region of resistance between 200 and 210 to hold, and if we can get this nice double bottom potentially triple bottom off of this, i want the stock to recapture the trend line very quickly battle it out. At 241 and then a more of a medium time frame, come back up and fill out the cup and handle so nice support right here, especially 200. It's a key technical level, but it's also a key psychological level. Humans love placing trades at these nice round levels.

So i'm very very much looking for that to hold if it doesn't hold, i would say the next support is between 180 and 185, that's been a very, very important region really all year for gme. So that's a quick technical breakdown of what we're looking for. In terms of the data, so on friday there was a net borrow against gme of quarter million and right now the short interest is 13.6. The shares on loan roughly 10.25, the utilization 34.

I think this is interesting, so the shares on loan roughly staying the same around 10 million, but the utilization is dropping, and what that tells you is that, since the amount of borrowed share is roughly flatlining, that tells you that the amount of total loanable shares is Actually increasing, remember utilization is borrowed shares divided by total loanable. So if this, if x, x, divided by y, if x, is staying constant, but the ratio is dropping, that tells you that y the number you're dividing by has to actually be increasing. Another thing i want to quickly point out to you here: the average durations of shares on loan remember. This is important because you have to loan the shares out to possibly take a short position, so the average duration of the shares on loan betting against gme is roughly 40 days.

If you look on the daily chart back roughly 40 days, that brings us to around mid-may kind of the end of the may so they're in about 170, give or take a little bit of risk like this isn't a perfect math. So that's telling us that on average, the shorts are actually down around 23 to 24. I'm just trying to give you some metrics that you can like actually examine yourself dive into this data. Of course you have to fact check me.

Do your own dd, but i'm just trying to present some interesting things that you may have not thought of. Yet, just to tell you like where the shorts are at are on like in the current situation and don't forget so not only are they down by 20 plus percent, but the cost to borrow they're paying that fee every single day. To borrow these shares out. To bet against gme, so that's kind of the bigger picture on the chart in the short interest and some of the trends that we're seeing now, let's fast forward to specifically what happened on friday, two different things i want to put out here.

So in the last hour of trading for july, 2nd this upcoming friday, we had a 28 000 bet in gme calls, and that was for the 400 strike, and then we also had a 27 000 bet on the 450 strike, so over 50 000 bet on games. I'm going above 400 this upcoming week. You know it's not always a perfect methodology to follow big money, but a lot of the times they might know something we don't know, and it's pretty interesting and then also earlier in the day around 10 30 in the morning. Someone bet over half a million dollars - 558 000 for september, the september monthlies on gamestop going above 300., so big money coming into the place specifically this past friday.

Let's see how that plays out and what i thought was interesting, especially about these that came in in the last hour of the day, gamestop was trending downward all day and then at the last moment it exploded. In fact, it went from 200 all the way up to 210. Pretty nice gain right before the market closed, so i think it could have something to do with these call options that came in, but i also think it has to do with the index rebalancing. So, for those of you don't know, a stock market index is basically a huge group of stocks.

You have the dow 30, the top 30 stocks in the us market, the s p, 500, essentially the top 500, the nasdaq 100, the top 100, with more of a technology focus and below that you have the russell 3000, that's the top 3 000 companies and the Top group of that it's split in two different groups: the top 1000 is the russell 1000 and then the leftover 2000, which you've probably heard of before, is the russell 2000. So recently, we've had a big rebalancing as before. The rebalancing both amc and gme were in the russell 2000, but recently gme actually got moved up to the russell 1000. So in that big big group, we have that top 1000 and then the bottom 2000, so jimmy got moved and amc didn't and i'll explain why in just a second, so here's kind of the criteria, and just so you know this big rebalancing.

It happens actually once a year and for this year, the ranking as in when they look at the companies and basically their market cap. It happened on may 7th. So, even though, as i'm filming, this amc has a hyatt market cap, then gme you have to rewind to what happened on may 7th and i actually have those numbers for you. So on may 7th gme had a value of 11.2 billion, while on the other hand, amc has a value, had a value of 4.3 billion.

But as i'm filming, this amc has a value of 27 billion and on the other side, gme has a value of 15 billion. So amc is actually worth more now as a company, but it all comes back to how the stocks were actually looking on may 7th. So, overall, the russell 3000, the top 3 000 companies um - and i mean the top 3 000.. So there's a huge disparity um.

The high market cap here are like kind of the credentials. That's not really a high market cap like they're, basically just calling out apple of like okay at this date. Uh apple is worth 2.2 trillion dollars, but from here the russell 1000 jamie is now in this like kind of awkward in between. So you have to be worth more than 3.6 billion to get in um and then the russell 2000, the high market cap of 7.3.

So this is why there was that awkward in between of the russell 2000. Well gme was worth more than 7.3. Hence why it met the credentials, the prerequisites to get moved up, but at that day on may 7th amc. Wasn't i'm just trying to explain like why i got moved from one to the other, so from this bottom chunk of the russell 2000, you now have the russell 1000 on top of it and within that russell 1000, also, obviously, within the russell 3000, you have the S, p.

500. The reason i'm bringing this up and sounding a bit convoluted. It's you have these indices and there are many portfolio managers out there who run funds that track these indices, the s p 500, one of the most popular as then there's a lot of money in these funds tracking this overall indices, as in the spy, the vu Kind of the same thing and then uh another popular one like here in the nasdaq 100, the dow, but the next popular one, is the russell 2000 there's a lot of money tracking, the russell 2000, but not so much the russell 1000. So that's what i'm saying that gamestop is like in that weird in between where it's too big to be in the russell 2000.

But it's not. It hasn't been inducted into the s. P, 500. Fun fact, as i'm filming this actually amc and gme do have the market cap requirements.

You have to be above 13.1 billion to go into the s p 500, but they're not in it, because there's actually other requirements such as like uh, repetitive quarters of profitability and there's a little bit of discretion in the overall vote. That's actually like a hot story line with tesla in 2020, but anyway, both amc and gme have the market cap requirements, but there are other requirements to be in the s p. 500. So anyway, as of now gme is in the russell 1000 out of the russell 2000, not so much uh in the s p 500, and this is why some people thought that that would actually be a headwind for gme.

They thought it would be a headwind because the people who are running funds, these portfolio managers, checking tracking the russell 2000 would sell gme and yeah. Some of the russell 1000 would pick it up, but they didn't think that the new buying would really outweigh the previous selling. But something had to happen right at the end of the day here, because this was the final day of balancing and we actually have that date right here. The newly constituted indices take effect after the market closes june 25th.

So right there people who were trying to properly track these indices at the very last second made a big move to basically proportionately follow the indices that they had to. So i thought that was interesting to know so, overall, what happened with gme? On friday, we had the the reshuffling of these indices, specifically gamestop, moving from the russell 2000 to the russell 1000, and we also saw some interesting action in the options market right before the market closed. So overall, that's kind of a rundown of what happened with gme. On friday, and also the the bigger picture of what we're looking at thus far in 2021, i really really like the technicals.

If we can follow through on this giant cup and handle, i think that could lead to some beyond interesting action for jamie. But obviously these are my own opinions and i would love to get your thoughts on gme in a comment below. If you enjoyed this video and you want to help, get it in front of other people, obviously there's all that good youtube. Algorithms up like comment subscribe and other than that from me and chair best of luck in the markets, you.

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