Shares of GameStop sank further on Tuesday, with shares of the volatile retail-trader favorite sliding 60% to about $89 per share.
The tumble follows a more than 30% drop during the regular market session Monday. The stock has now slid more than 70% since Friday’s close.
GameStop’s shares have traded wildly in recent weeks after retail traders on a Reddit forum sparked a short squeeze in the stock, a phenomenon where traders who had bet against the stock are forced to buy it to limit their losses, pushing the price even higher.
Short interest in GameStop as a percentage of shares available for trading dropped to about 53% from over 110% a week ago, according to data from S3 Partners.
“Both fundamental and momentum short sellers have found opportunities and price exit points to trim their positions in the face of these losses as the GME short squeeze is in full force,” said Ihor Dusaniwsky, S3 managing director of predictive analytics.
The recent covering pared short sellers’ losses in the stock to about $13.4 billion year to date, from nearly $20 billion just last week amid the stock’s remarkable pop, S3 data showed.
The retail activity has helped fuel extreme volatility and high trading volume in GameStop and other stocks. However, Monday’s trading volume was the lowest in the brick-and-mortar video game retailer’s stock since Jan. 20, according to FactSet.
However, one popular Reddit user, DeepF******Value, is apparently still holding onto his GameStop shares, incurring a loss of about $5 million following Monday’s drop, according to a screenshot showing the user’s portfolio.
The dramatic decline for GameStop was mirrored by similar reversals in other popular Reddit trades, such as AMC Entertainment. The volatile period has drawn comparisons to other historical short squeezes, including the Volkswagen short squeeze of 2008.
GameStop’s struggles came even as free trading brokerage Robinhood eased back on the restrictions it placed on highly volatile names. The brokerage allowed users to buy up to 20 shares of GameStop as of Monday afternoon, up from just one share at the beginning of the day and four shares around noon ET.
Other brokerages, however, weren’t able to offer trading. Payments service Cash App, which is owned by Square, said its clearing broker Axos had halted trades of GameStop on Tuesday.
The volatile moves and brokerage restrictions have garnered attention from politicians and regulators in Washington. The chairwoman of the House Committee on Financial Services, Rep. Maxine Waters, D-Calif., announced on Monday that there would be a hearing on Feb. 18 about the recent trading in GameStop.
— with reporting from CNBC’s Yun Li and Maggie Fitzgerald.
