AMC stock is up +19.53% in the past month.
The movie theatre chain stock has broken resistance levels after it had bounced at $5 levels.
The $6 levels have been a strong demand zone for AMC, and recent volume has moved the stock up to $8.30.
But recent halts forced the stock to trade below $8, sending it back to $7 levels where it’s currently trading again.
How soon will AMC break the next level of resistance and move past $8 levels?
Let’s discuss what it’s going to take for the movie theatre chain to trigger massive price action again.
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Volume is Key, But It’s Come Down
It’s not uncommon for trading volume to decline during a bear market.
Investors tend to sell stock more often than buy it during these times.
AMC’s average volume has dropped from 46 million earlier this year to 29.2 million.
There have been trading days where AMC’s share price spikes due to a high-volume day.
But these high-volume trading days have now become somewhat of anomalies compared to last year’s heavy buying weeks and months from retail.
Even now as we see AMC break resistance levels above $6 and $8, we see the importance of big volume days.
The SPY is showing us that the markets are readjusting again, ready for a market bounce after a dreadful bear market.
As investor confidence increases in the market, we may begin to see AMC’s average volume begin to rise again.
AMC’s Fundamentals Strike Wall Street Pessimists
Last year we saw many financial institutions were loading up on AMC Entertainment stock around the $9-$14 levels.
The difference this year is that AMC is a much better company fundamentally than it was last year.
Not only has the company cut its debt load, but it’s also beat earnings expectations every quarter since Q1 of 2021.
The century old company continues to be a retail favorite with many shareholders even turned loyal customers.
Shareholders have no doubt the community made up of millions of investors will squeeze short sellers again.
Only this time AMC will reach a new all-time high not seen yet.
Not only is the popularity of AMC increasing, but so is the popularity of investing in the stock market.
New investors getting into the stock market will be looking to capitalize on opportunities such as an AMC short squeeze.
Institutional and retail investor confidence in the market is what’s going to create big volume in the coming weeks as the market continues to bounce.
Worst Case Scenario?
My short-term view on AMC Entertainment stock is bullish.
Worst-case scenario is a bounce takes on more of a long-term approach.
Consolidation in AMC will indicate indecision, which means retail investors will need to step it up and demonstrate to institutions AMC is worth going long on.
Afterall, Wall Street can only deny AMC’s progress for so long until the narrative takes a complete 180 degrees.
But ultimately, retail investors are the key here.
Without retail investors, without the public, without the people, AMC stands no chance against Wall Street pessimists who have mainstream media to their advantage.
This is the blog of the people.
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