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       lite.cnn.com - on gopher - inofficial
       
       
       ARTICLE VIEW: 
       
       Trump Media stock mysteriously plunges
       
       By Matt Egan, CNN
       
       Updated: 
       
       10:15 PM EDT, Tue October 15, 2024
       
       Source: CNN
       
       Former President Donald Trump’s social media company suffered a
       sudden nosedive in the stock market Tuesday that briefly halted trading
       and left traders scratching their heads.
       
       Truth Social owner was trading sharply higher during a volatile session
       at about $31 per share when it swiftly collapsed below $29 shortly
       after 2:40 p.m. ET on heavy trading volume.
       
       Nasdaq paused trading for Trump Media at 2:42 p.m. ET for five minutes,
       a routine cooling-off period that  during times of heavy volatility.
       
       When trading resumed, Trump Media initially bounced back before
       plunging below $27.
       
       The owner of social media platform Truth Social ended the day down
       10%, and 20% below its high of the day.
       
       There did not appear to be any new developments or announcements that
       would explain the sudden plunge. But Trump Media is a notoriously
       volatile stock.
       
       Matthew Tuttle, CEO of Tuttle Capital Management, told CNN he suspects
       the selloff was caused by technical factors. He said that when Trump
       Media’s share price failed to break through its 200-day moving
       average, a closely-watched technical level, traders “flipped” to
       bet against it.
       
       Up until Tuesday afternoon, .
       
       The stock had more than doubled its value in the span of three weeks, a
       stunning move driven by polling and betting odds that suggest the race
       for the White House could go either way.
       
       “Sometimes the bottom falls out of these types of moves pretty
       quickly,” Tuttle said in an email.
       
       University of Florida professor Jay Ritter noted that trading volume in
       shares of Trump Media was “enormous” on Tuesday.
       
       “With meme stocks, where many of the holders are playing short-term
       momentum strategies, when the tide turns, everyone wants to move in the
       same direction,” Ritter said, describing Trump Media as a meme stock
       akin to GameStop and AMC.
       
       Ritter said that while it’s “rare” to see a multibillion-dollar
       company plunge like this with no news, meme stocks are subject to
       sudden moves because they are being driven by momentum, not
       fundamentals.
       
       At Tuesday’s peak, Trump’s stake of 114.75 million shares in the
       company was worth $3.88 billion on paper. But by the end of the day,
       the value of that stake had dropped to $3.1 billion.
       
       This is the second recent trading halt for Trump Media. Last month, at
       Nasdaq over the routine action, threatening to move the listing to the
       New York Stock Exchange.
       
       Trump Media shares climbed 2% higher in after-hours trading.
       
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