HAT TIP to RESEARCH GURUHat Tip to ResearchGuru
I feel like there are a ton of new and confused traders in here so I'm going to help explain what's happening...
Gamestop (GME) and (AMC) are two failing companies who's stocks got a bump in the market due to some recent good, but ultimately inconsequential news. That jump caused large multi-billion dollar short-selling hedge funds to short GME and AMC stock with the assumption that they'd continue to fall after their bumps.
(Short selling is when someone borrows shares at a higher price then sells it with the assumption that they can buy the shares again later (1/29) at a cheaper price, give those shares back and then pocket the difference.)
This is where we the people (FB, Reddit, Twitter..) come in to ruin their day.
A bunch of us agree to flood AND HOLD! the stock with unexpected new money, causing the stock price to rise instead of fall. This causes the short sellers to lose money because they are going to have to give back those borrowed shares in the future (1/29).
As the short sellers watch the stock rise alomg with their losses, they start folding one by one and buying the stock in order to give the shares back and close their position. Buying those shares causes the stock to rise which in turn puts MORE pressure on the short sellers and more of them have to buy more shares... This is called a SHORT SQUEEZE.
On Friday (1/29), time will be up for many of the short sellers. They'll have to close out their positions by buying stock which will cause NAKD. AMC, EXPR, and GameStop to sky rocket.
That is why you BUY NOW (apply pressure and start your investment) and HOLD. Because every person that sells is relieving the pressure and reducing the billions of dollars the hedge funds will owe us, the little guys.
The price will go up, and it will go down, just buy it and hold it at LEAST until Friday 1/29.
I copied this comment so Copy and paste to educate the people!