Skillz Inc (NYSE:SKLZ) was trending on r/WallStreetBets Wednesday after rising over 11% higher in Tuesday’s trading session. In the pre-market the eSports and gaming competition-focused company was soaring up another 7% higher.
Retail traders have been banding together within groups throughout 2021 to and targeting specific stocks to buy shares of, en masse, to run the stock higher. The most well-known stocks targeted were GameStop Corporation (NYSE:GME) and AMC Entertainment Holdings, Inc (NYSE:AMC) but numerous stocks have caught the eye of retail investors for their bizarre underlying statistics.
Skillz (NYSE:SKLZ) fits the bill for a short squeeze target:
- Small Float: Skillz has a relatively small float of 281.35 million shares.
- High Ownership: 72.88% of Skillz float is held by insiders and institutions with insiders owning 15.08% of available shares and institutions owning 57.80%.
- High Short Interest: 57.28 million, which means 18.98% of Skillz total float is held short. This number is up from 49.9 million in July.
The Skillz Chart: Skillz is a relatively new company that went public through a SPAC and debuted on the New York Stock Exchange on April 27, 2020. Amid sports betting sector hype at the start of 2021, Skillz reached a Feb. 5 high of $46.30 before falling almost 80% and toward its IPO price of $9.95.
When Skillz retraced near to the level on Aug. 19 and Aug. 20, the stock created a bullish double bottom pattern and bounced up almost 12% higher in the three days that followed. The stock then consolidated before soaring during Tuesday’s session.
On Tuesday Skillz firmly regained the eight-day exponential moving average (EMA) as support but battled and closed slightly under the 21-day EMA. On Wednesday if Skillz opens above the $12.50 level it will have regained not only the 21-day EMA but a resistance level at $12.50.
If Skillz can trade above the level for a few trading days, the eight-day EMA will cross back above the 21-day EMA which would give bulls confidence a larger rebound is on the way.
Skillz has resistance above at $15.90 and $18.10 and support below at $9.95 and its all-time low of $9.81.