This is a quick short idea. I have a special place in my heart for meme stocks. While the moves they made back in 2021 were truly remarkable (I admit I was extremely jealous at the time), those days are done. I’m sure some day we will see something like this happen again (much fewer and far between I think since now everyone is looking for it). But now any sort of “squeeze” attempts are being met with selling holding the resistance.
I won’t get into the weeds, but this was another stock which managed to squeeze shorts back in 2021. On the monthly chart we can see that squeeze actually got this all the way back up into the triple digits where is was 23 years ago. But those are some mighty big wicks on monthly candlesticks. There is some longer term support near $12 that I think we are headed back towards. Whether we bounce or break is another story, but I think at the very least we are going to test. I’ll go ahead and say I think the break is more likely as this rejection off that 20 Month MA looks quite strong.
On a weekly we can see the medium-term bearish pattern more clearly. The meme squeeze really tried to hold that $42 level for a long time and managed to break down after the December 2021 market peak. There was a lot of volatility, bounce and retest and finally rejection in the first half of 2022 (first red circle). After the July bounce we saw another bounce and successfully held beneath that resistance (second red circle) and are in the midst of this rejection. Now we see this cross beneath the 200 Week MA in a breakdown out of a weekly candle consolidation. I think we are just about to spillover back to lows on this thing.
And there you have it. With meme stocks, there is no analysis other than short interest. But that trick only works if the sellers are caught off guard. I’m sure insiders are begging for WSB to send a bunch of buyers their way to get out at inflated prices and leave them holding the bag. Even today, this is the top headline under SAVA on Yahoo:
