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Memestock Rally Continues In Premarket As Roaring Kitty Brings Us Back To 2021

Asktraders News Team trader
Updated 14 May 2024

The march seems to be going on as NYSE: GME trades up more than 40% in the premarket, as NYSE: AMC share price is up 38%. The volatility we are seeing is not new to holders of these stocks, with the similarities between 2021 and today likely to resonate.

In a rather nostalgic echo of the past, Keith Gill (otherwise known as Roaring Kitty), the pivotal figure behind the GameStop short squeeze of 2021, made a triumphant return to social media. After almost three years of silence, his comeback has people wondering whether we could witness a repeat of the frenzy that shook Wall Street and triggered a bull run in stocks followed by the retail community.

Gill, who rose to prominence during the 2021 GameStop stock rally, stirred the financial community this week as his reappearance coincided with a 74% spike in GameStop's stock price. Trading had to be temporarily halted owing to the extreme volatility this rally induced. The effects were not limited to trading floors; they dealt a severe blow to short sellers, who incurred losses surpassing $1 billion as meme stocks surged, demonstrating the colossal impact that social media figures can have on stock market dynamics.

The influence of Gill extends beyond market fluctuations. His tales of financial David vs. Goliath have made it onto the silver screen in the 2023 film “Dumb Money”, which explores the GameStop short squeeze saga. Despite his celebrity among retail investors, Gill has faced scrutiny from financial regulators and the broader public. During a Congressional hearing, he defended his actions by asserting his genuine belief in the potential of the stocks he promoted, rather than an intent to manipulate the market.

Gill's resurgence highlights how individual influencers can wield substantial power over trading activity and market sentiment in today's digital age. The amplification of voices like Roaring Kitty's through online communities such as WallStreetBets has brought about a shift in the financial industry, empowering individual investors to question and challenge traditional market norms. This democratization of finance, fed by social media, has introduced a new era where meme stocks and social media-driven trading continue to evolve and influence the markets, drawing both keen traders and vocal critics.

The financial landscape has evolved since the first GameStop saga and the view is split on the potential for a sustained repeat. While some believe that Gill's presence could fuel short-term market moves, others have reservations.

You would expect that some are now more cautious and better informed about the speculative nature of such rallies, and some of the FOMO may not rear its' head quite so soon. The surprise and novelty factor that partly drove the previous surge no longer exist, making it less likely that history will repeat itself in the same manner but the community still remains strong.

It will certainly be interesting to see if the sustained commitment of 2021 can indeed be conjured again, or if the community and markets have moved beyond the influence of such singular events.

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