AMC Entertainment Holdings Price: AMC stocks aims for fifth day of gains
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- AMC just cannot stop going up, reaching nearly 3% on Wednesday.
- AMC shares trade through $10 for four straight days of gains.
- AMC outperforms the broader market by 6% on Wednesday.
Update: Another day of gains for AMC as it notches for straight days of gains now. While everything else comes crashing down AMC rises nearly 3%. breaking $10 and turning increasingly bullish on the chart. Truly an impressive performance. Tuesday saw a lot of meme stocks rally as retail money exited Bitcoin and returned to meme stocks. Wednesday, however, was an ugly day, with the Nasdaq slipping nearly 3% and meme stocks suffering even heavier falls.
The drive for five is alive as AMC is up slightly in Thursday's premarket.
AMC stock news
Now back to those AMC results. The CEO Adam Aron said that AMC was in a great position as 7 million cinema goers attended AMC theatres in Q1. Not a bad figure you might think but 7 million cinema-goers in Q1 still equated to a loss.
EPS was $-1.42 versus a forecast of $-1.26. Revenue was $147.4 million versus a $153.6 million forecast. So a surprise, but not really a surprise, given the background that we are all too familiar with. AMC shares rallied on Friday and again on Monday as meme traders focused on the bullish comments from CEO Adam Aron. Well, if the CEO isn’t bullish then who can be? Conference calls post-earnings releases always tend to err on the side of bullishness. Aron alluded to the Reddit, r/wallstreetbets crowd by thanking the new retail investors and making a donation to the Diane Fossey Gorilla Fund which has been popular with Reddit investors who refer to themselves as apes. A noble act that is showing the benefits of the retail traders banding together.
In case you are not familiar with AMC, here is a quick rehash of the story so far. You could make a movie out of this one. Oh wait, they are! Well, GameStop is the leading star, AMC is the best supporting cast.
AMC is a global cinema chain and, as a result, has struggled during the global pandemic as most of these cinemas have been closed for the better part of a year. The company narrowly avoided bankruptcy through the interest of retail traders. By strongly backing it, these retail traders allowed AMC to raise capital and debt, meaning it could survive the pandemic. AMC and GameStop were two of the meme stock favourites at the height of the retail trading boom. Volumes on retail trading sites are lessening as the US opens back up, reducing the captive trading audience.
AMC still has serious problems, which make a long-term investment in the stock questionable. The company just has way too much debt and is facing headwinds from streaming players releasing online and in cinemas simultaneously. Disney has recently made such announcements.
AMC stock forecast
So the fundamentals are questionable, to say the least. This is not a long-term investment but short-term trends can be profitable and AMC is showing some interesting chart levels to trade around.
For now, things are looking a bit more bullish. AMC rallied nearly 6% on Friday and nearly 3% on Monday. In the process, the shares staged a strong bounce from the lower end of the triangle and horizontal support at $8.95. AMC traded up and tested the 9 and 21-day moving average resistances before closing Monday range-bound between them. This area will be the first resistance to recapture.
AMC is very close to being in a bullish trend but is not there just yet. It needs to close above this range between the 9 and 21-day moving averages and above $10. Breaking resistance at the 9 and 21-day moving averages located at $9.66-9.86 will turn the short-term trend bullish. Look for a crossover from the Moving Average Convergence Divergence (MACD) or Directional Movement Index (DMI) to confirm. Monday has come very close to giving a crossover signal so Tuesday is key.
Otherwise, initiate shorts or buy put options on a failure to break this $9.66-9.86 resistance. A break would mean the next target to be the top of the triangle at $11.30 and a break out from there would bring levels above $20 as the breakout target. Given the fundamentals underlying AMC, this is pretty optimistic, but this stock is highly volatile.
Failure to push on will see AMC move to test support at $8.95 and a potential triangle breakout which would be very bearish with a sub-$2 price target, what would be a catastrophic level for bulls.
Previous updates
Update: AMC continues to outperform and rallies above $10 in early trade on Tuesday. Can it hold the gains is the big question as AMC sits just above the 9 and 21-day moving averages. A close above $10 would be particularily beneficial to bulls and target the top of the triangle at $11.24.
AMC shares did it again on Monday, powering ahead despite global equity markets starting to look increasingly nervous. AMC closed up nearly 3% at $9.74. The psychological resistance at $10 is in sight, but will AMC manage to get there as equity markets in Europe take a beating this morning?
The story behind this rally is more of the same really, a lot of volatility and speculation with struggling underlying fundamentals. AMC released results on Thursday and they were terrible. However, the CEO cut an optimistic tone on the conference call and retail investors chose to go with their man. It also helped that CEO Adam Aron gave a shoutout to the Reddit crowd.
This appears to be a new trend in investing for 2021, the art of the shoutout, as popularized by many celebrity social media accounts posting mainly about cryptocurrency. The cynic may say it is easier to give shoutouts about non-SEC regulated cryptocurrency. So far, 2021 has brought some new and highly complex investing terminology to the fore. "To the moon", "all together apes", "Doge me up baby", to name just a few. Data analytic firms have been compiling some of these into highly useful short-term trading monitors as they scour online sites for the latest most-hyped asset. Definitely, something to get used to, however long it lasts.
At the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
This article is for information purposes only. The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice. It is important to perform your own research before making any investment and take independent advice from a registered investment advisor.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to accuracy, completeness, or the suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. The author will not be held responsible for information that is found at the end of links posted on this page.
Errors and omissions excepted.
- AMC just cannot stop going up, reaching nearly 3% on Wednesday.
- AMC shares trade through $10 for four straight days of gains.
- AMC outperforms the broader market by 6% on Wednesday.
Update: Another day of gains for AMC as it notches for straight days of gains now. While everything else comes crashing down AMC rises nearly 3%. breaking $10 and turning increasingly bullish on the chart. Truly an impressive performance. Tuesday saw a lot of meme stocks rally as retail money exited Bitcoin and returned to meme stocks. Wednesday, however, was an ugly day, with the Nasdaq slipping nearly 3% and meme stocks suffering even heavier falls.
The drive for five is alive as AMC is up slightly in Thursday's premarket.
AMC stock news
Now back to those AMC results. The CEO Adam Aron said that AMC was in a great position as 7 million cinema goers attended AMC theatres in Q1. Not a bad figure you might think but 7 million cinema-goers in Q1 still equated to a loss.
EPS was $-1.42 versus a forecast of $-1.26. Revenue was $147.4 million versus a $153.6 million forecast. So a surprise, but not really a surprise, given the background that we are all too familiar with. AMC shares rallied on Friday and again on Monday as meme traders focused on the bullish comments from CEO Adam Aron. Well, if the CEO isn’t bullish then who can be? Conference calls post-earnings releases always tend to err on the side of bullishness. Aron alluded to the Reddit, r/wallstreetbets crowd by thanking the new retail investors and making a donation to the Diane Fossey Gorilla Fund which has been popular with Reddit investors who refer to themselves as apes. A noble act that is showing the benefits of the retail traders banding together.
In case you are not familiar with AMC, here is a quick rehash of the story so far. You could make a movie out of this one. Oh wait, they are! Well, GameStop is the leading star, AMC is the best supporting cast.
AMC is a global cinema chain and, as a result, has struggled during the global pandemic as most of these cinemas have been closed for the better part of a year. The company narrowly avoided bankruptcy through the interest of retail traders. By strongly backing it, these retail traders allowed AMC to raise capital and debt, meaning it could survive the pandemic. AMC and GameStop were two of the meme stock favourites at the height of the retail trading boom. Volumes on retail trading sites are lessening as the US opens back up, reducing the captive trading audience.
AMC still has serious problems, which make a long-term investment in the stock questionable. The company just has way too much debt and is facing headwinds from streaming players releasing online and in cinemas simultaneously. Disney has recently made such announcements.
AMC stock forecast
So the fundamentals are questionable, to say the least. This is not a long-term investment but short-term trends can be profitable and AMC is showing some interesting chart levels to trade around.
For now, things are looking a bit more bullish. AMC rallied nearly 6% on Friday and nearly 3% on Monday. In the process, the shares staged a strong bounce from the lower end of the triangle and horizontal support at $8.95. AMC traded up and tested the 9 and 21-day moving average resistances before closing Monday range-bound between them. This area will be the first resistance to recapture.
AMC is very close to being in a bullish trend but is not there just yet. It needs to close above this range between the 9 and 21-day moving averages and above $10. Breaking resistance at the 9 and 21-day moving averages located at $9.66-9.86 will turn the short-term trend bullish. Look for a crossover from the Moving Average Convergence Divergence (MACD) or Directional Movement Index (DMI) to confirm. Monday has come very close to giving a crossover signal so Tuesday is key.
Otherwise, initiate shorts or buy put options on a failure to break this $9.66-9.86 resistance. A break would mean the next target to be the top of the triangle at $11.30 and a break out from there would bring levels above $20 as the breakout target. Given the fundamentals underlying AMC, this is pretty optimistic, but this stock is highly volatile.
Failure to push on will see AMC move to test support at $8.95 and a potential triangle breakout which would be very bearish with a sub-$2 price target, what would be a catastrophic level for bulls.
Previous updates
Update: AMC continues to outperform and rallies above $10 in early trade on Tuesday. Can it hold the gains is the big question as AMC sits just above the 9 and 21-day moving averages. A close above $10 would be particularily beneficial to bulls and target the top of the triangle at $11.24.
AMC shares did it again on Monday, powering ahead despite global equity markets starting to look increasingly nervous. AMC closed up nearly 3% at $9.74. The psychological resistance at $10 is in sight, but will AMC manage to get there as equity markets in Europe take a beating this morning?
The story behind this rally is more of the same really, a lot of volatility and speculation with struggling underlying fundamentals. AMC released results on Thursday and they were terrible. However, the CEO cut an optimistic tone on the conference call and retail investors chose to go with their man. It also helped that CEO Adam Aron gave a shoutout to the Reddit crowd.
This appears to be a new trend in investing for 2021, the art of the shoutout, as popularized by many celebrity social media accounts posting mainly about cryptocurrency. The cynic may say it is easier to give shoutouts about non-SEC regulated cryptocurrency. So far, 2021 has brought some new and highly complex investing terminology to the fore. "To the moon", "all together apes", "Doge me up baby", to name just a few. Data analytic firms have been compiling some of these into highly useful short-term trading monitors as they scour online sites for the latest most-hyped asset. Definitely, something to get used to, however long it lasts.
At the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
This article is for information purposes only. The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice. It is important to perform your own research before making any investment and take independent advice from a registered investment advisor.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to accuracy, completeness, or the suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. The author will not be held responsible for information that is found at the end of links posted on this page.
Errors and omissions excepted.
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