GameStop Sees Jump in $20 Put Options Volume Amid Stock Sell-Off
$GameStop (GME.US)$ is seeing a jump in demand for put options that could protect the shareholder against an extended stock slump after the company's quarterly revenue missed analysts' estimates.
The stock plunged 15% to $19.93 Wednesday after the videogame retailer reported that second quarter sales declined to $798 million, from $1.16 billion a year earlier. That missed the average estimate of $895.7 billion expected by two analysts who tracked the stock, according to Capital IQ data.
The stock plunged 15% to $19.93 Wednesday after the videogame retailer reported that second quarter sales declined to $798 million, from $1.16 billion a year earlier. That missed the average estimate of $895.7 billion expected by two analysts who tracked the stock, according to Capital IQ data.
The slump pushed the put options that give the holders the right to sell the stock at $20 in two days just a hair away from being in the money. About 17,740 of those puts changed hands as of 12:27 p.m. in New York Wednesday, almost double the open interest, data compiled by moomoo.
That volume is almost 70% of all put options with that strike price spread across 11 expiration dates that stretch through Jan. 16, 2026. That makes that $20 strike price the most popular among contracts linked to GameStop. In total, 295,410 contracts, including calls, changed hands, making GameStop the fourth most active stock options so far, behind $NVIDIA (NVDA.US)$, $Tesla (TSLA.US)$ and $Apple (AAPL.US)$. (To see the options ranking, click here.)
Outflows from GameStop outpaced inflows by $42.8 million, data compiled by moomoo showed. That adds to this month's net outflows of $45.11 million.
Amid that sell off, technical indicators tracked by moomoo are showing positive signals. Seven of the 15 gauges are showing that the stock could now be oversold, and the trend may turn bearish. The stock price has breached the lower line of the Bollinger Band, which could be seen as a sign by some who study charts that it could revert and rebound from today's low. Still, it's crucial to use the band along with other technical indicators and review the fundamentals when looking at the trend.
Share your thoughts on GameStop in the comments section. And if you have a price forecast, please vote below.
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Moomoo Senior News and Community Manager
Former editor at Bloomberg, then Lazard Asset Management. Posts aren’t investment advice. Views are just mine.
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LittleSoldier : Game stop is a joke!!
Stop peddling
Nathaniel cyr : How can I deposit funds to invest and trade
White_Shadow : keep the momentum going and it could stabilize over $20
72078329 : i was sick and had the 3 opperation if i can do i can stulill do ill learn it . starting ge5t on my feet
Laine Ford : no comment
Cypher : “That missed the average estimate of $895.7 billion…” did you mean $895.7 million* instead?
@Luzi Ann Santos
Cypher : “15 gauges are showing that the stock could now be oversold, and the trend may turn bearish.” Maybe you meant to say bullish* here?
@Luzi Ann Santos