AMC Entertainment Holdings, Inc. plunged about 9 percent at one point on Thursday morning before bouncing up from the $20.91 level.
2021 in Retrospect
The theater chain’s stock brought much controversy during the 2021 trading year as retail traders, calling themselves “apes,” piled into the stock and sent AMC on two separate short squeezes toward the moon about six months apart, in January and June.Critics of the apes and their goal—to make Wall Street accountable and transparent by putting an end to market manipulation through naked short selling and dark pool trading—said dark pool trading isn’t predatory and that because the amount of naked shorting is counted in total short interest, it’s not a manipulation tactic.
Looking Ahead to 2022
On Jan. 3, AMC CEO Adam Aron took to Twitter to outline his New Year’s resolution for the company that focuses on strengthening the balance sheet.“I’d like to refinance some of our debt to reduce our interest expense, push out some debt maturities by several years and loosen covenants,” Aron wrote.
As of November, AMC’s interest payments had grown to about $332 million in the first nine months of the year alone.
Aron is revered by many in the ape communities across various social media sites for not only his willingness to embrace retail traders but to tailor the business toward their interests by accepting Dogecoin as payment for gift cards, tickets and concessions and entering into the NFT space.
AMC Chart
On Thursday, when AMC bounced and wicked from the $20.80 level it created a bullish double bottom pattern on the daily chart when paired with similar price action at that level on Dec. 14. If AMC closes the trading day near its opening price or higher, it will print either a long-legged doji candlestick or a hammer candlestick, which could indicate higher prices will come on Friday.Both candlesticks are often found at the bottom of a trend and paired with the double bottom pattern could indicate a strong reversal is in the cards.
AMC’s relative strength index is hovering just above the 30 percent level, which indicates the stock is oversold and can be a buy signal for technical traders.
By mid-day, AMC had far higher-than-average volume with about 36 million shares having already exchanged hands compared to the 10-day average of 33.18 million. A higher amount of volume in a stock indicates there is a high level of trader and investor interest.
AMC has resistance above at $25.79 and $29.45 and support below at $20.36 and $17.07.
