Companies are playing well the age old game of trying to run up their stocks.The Arora Report members gain an edge with our proprietary sentiment indicator that is shared daily in the Afternoon Capsule.As an example, the stock market rally in 2023 is mostly based on positive sentiment driven by the AI frenzy, resulting in PE expansion.As discussed in yesterday’s Morning Capsule and many other prior capsules, prudent inventors track sentiment. Sentiment plays a major part in the moves in the stock market.The meme crowd was surging during the pandemic. Theater chain AMC Entertainment Holdings Inc AMC and video game retailer GameStop Corp GME were top meme crowd favorites. The meme crowd ran up GME from about $1 to over $120 (outside regular trading hours), and now the stock has fallen back to $21. The meme crowd also ran up AMC from the $2 range to $72, and now the stock has fallen back to under $5.The meme crowd often becomes resurgent when sentiment becomes very positive.The meme crowd is the crowd that copies trades based on social media and believes that their collective buying can run up the stocks. An important indication of sentiment is the activity of the meme crowd.It is very important right now for investors to track the sentiment. The reason is that the stock market has risen on sentiment driven by the AI frenzy and Bidenomics while earnings have declined.In The Arora Report analysis, without the meme crowd activity, YELL stock is worthless.The news this morning is that Yellow has filed for bankruptcy. How is the meme crowd responding to the news? They are urging the crowd to double down and buy more YELL stock aggressively.The chart shows that the meme crowd ran up YELL stock by 861% in three days.To most investors, bankruptcy is not good news, but the meme crowd is different. The chart shows that the meme crowd aggressively bought YELL stock on the bankruptcy news.The chart shows when it became clear that the bankruptcy of Yellow was imminent.The Morning Capsule is about the big picture, not an individual stock. The chart of YELL is being used to illustrate the point.Please click here for a chart of the trucking firm Yellow Corporation YELL. YELL is the latest meme stock.
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