Analyst Sees GME-Style Gamma Squeeze In Hyperliquid's PURR Within 60 Days

• Hyperliquid Strategies could see a GameStop-style gamma squeeze over the next 60 trading days, Capital Flows said, revealing it is the analyst’s largest personal position.
• PURR’s $1.4 billion market cap and small float are reminiscent of GameStop pre-2021, the analyst said.
• Cited catalysts include PURR's June 26 Russell 2000 and 3000 inclusion and the potential for US adoption of Hyperliquid, though such low-float squeeze setups are highly speculative.

Hyperliquid Strategies Inc. (PURR) is set to go for a gamma squeeze like the 2021 rally of GameStop (GME), investment research publication Capital Flows said on Sunday, a thesis that doubles as a disclosure of the analyst’s largest personal holding.

Capital Flows cited in their recent newsletter that credit-cycle liquidity, the stock’s small tradable float, and a wave of call buying, saying there is a “very high probability” of a gamma squeeze in PURR within the next 60 trading days. Notably, they also revealed that they are holding their full position in the move expected. 

PURR has a small float and a market cap of around $1.4 billion, the same valuation as GameStop before its 2021 squeeze, the author wrote. They said PURR recently had its largest single day of trading volume on record, with implied volatility rising along with price, a pattern they interpreted as heavy call demand. They argued that the listed strikes are capped at $18, so if the stock rises and higher strikes are listed, market makers would have to buy shares to hedge, adding fuel to a self-reinforcing move. 

Two Reasons For A Gamma Squeeze

The author cited two catalysts. One, PURR’s upcoming addition to the Russell 2000 and 3000 indexes, which will be effective after the close of the US market on June 26, and the potential inclusion of Hyperliquid in the United States. They said the bigger picture is a credit-cycle “everything rally” pushing capital into higher-beta assets. Gamma-squeeze setups with low float and concentrated call buying are very speculative and can reverse quickly. 

On X, the analyst said, “PURR just had its largest day of trading volume, indicating how aggressively investors are establishing positions into the regulatory change for Hyperliquid.”

However, he also said, “There is a massive problem with the calls right now, though. The strikes aren't listed very high.” He also added, “PURR implied volatility is beginning to rise AT THE SAME TIME that the stock is rallying. Why? Because the market is beginning to recognize that the leadership of PURR is adding significantly more value than any ETF.”

PURR’s stock closed over 16% on Friday. On Stocktwits, PURR was one of the top trending tickers. Retail sentiment around PURR remained in the ‘extremely bullish’ zone, while chatter stayed at ‘extremely high’ levels over the past day.

Hyperliquid’s crypto token HYPE’s price also reached an all-time high on Sunday, making it the fourth high the token reached in a week. On Stocktwits, HYPE was also one of the top trending tokens, with retail sentiment around it remaining in the ‘extremely bullish’ zone. Chatter stayed at ‘extremely high’ levels over the past day.

Read also: Bitcoin And Ethereum Bled This Week - But These 4 Altcoins Jumped, One Up 157%

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