BZ Chart Of The Day: GameStop Crashes Into A Wall Of Sellers

In financial markets price levels that were previously support can convert into resistance. That’s why the GameStop Corp. (NYSE: GME) rebound may have halted.

This conversion happens because of buyer’s remorse.

In August, the $150 level was support for GameStop. There was a large number of buyers and they put a floor under the price and a rally followed.

Now the price is lower.

Many of these investors experience buyer’s remorse and decide to sell, but they're reluctant to take a loss so they place their sell orders at the same price they bought their stock at.

If there are enough of these sell orders at or close to the $150 level, it will cause resistance to form. That may have happened here.

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Photo: Dimitris Chapsoulas on Unsplash