GameStop stock retreats from record gains after more than half of short positions eliminated

Last week, GameStop’s stock soared 400% in an extremely volatile trading week where retail investor loyalists of the stock assembled via the Reddit WallStreetBets thread clashed with institutional short sellers on Wall Street.

Ihor Dusaniwsky — the head of predictive analytics at financial technology and analytics firm S3 Partners, which specializes in analyzing data on short selling — said on Monday that the “short squeeze has begun” on GameStop, even though some were speculating that a short squeeze was boosting the stock in mid-January.

The number of GameStop shares shorted fell by 35.2 million over last week, leaving 27.1 million short positions remaining. Shorts have lost more than $13 billion in 2021 alone on GameStop even after gaining $1.9 billion on Monday’s downturn, Dusaniwsky said.

“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,” Dusaniwsky said in emailed comments.

Meanwhile, the stock most likely to be said in the same breath as GameStop, AMC Entertainment Holdings Inc. AMC, +5.02%, was up about 7% at $14.14 even as one analyst downgraded the stock to a sell rating and cut their price target to $1.