Market News: APE failure to deliver surge since inception.
AMC’s Preferred Equity, APE, topped $304.9 million in FTDs last year.
The FTDs are reported for the month of August, per Stocksera.
FTDs, or Failure-to-deliver occurs when one party in a trading contract (whether it’s shares, futures, or options) fails to deliver on their obligations.
These failures derive due to buyers not having enough money to take delivery and pay for the transaction at settlement.
In the case of sellers, it means not having the goods to meet that transaction.
Failure-to-deliver can occur in options trading or when selling short naked, per Investopedia.
AMC Entertainment has been a big target for short sellers looking to profit from the demise of the century old movie theatre chain.
The alarming amount of APE FTDs further proves this.
Let’s discuss it below.
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According to Investopedia, APE FTDs can also occur if there is a technical problem in the settlement process carried out by the respective parties (clearing houses).
There’s a major conflict of interest when Citadel Clearing LLC transacts orders worldwide.
Ken Griffin’s Citadel LLC is short on AMC Entertainment stock, so we can see how utilities play out in the hedge fund’s favor.
It’s unlikely FTDs have been a result of retail buyers since the majority are purchasing the equity on cash accounts where orders execute almost immediately.
Naked short selling seems to be the most probable cause here as $APE has tumbled despite heavy retail interest.
The large amount of FTDs is manipulative and quite common in stocks such as AMC and GameStop.
Retail investors have taken it to Twitter to express their concerns to SEC Chairman Gary Gensler.
And although activists continue to engage the Chairman, no action has taken place to justify the ongoing market manipulation in APE, AMC, and GameStop.
Others are suggesting protesting outside SEC locations across the country.
Leave your thoughts on APE
There’s a lot of speculation surrounding APE FTDs and APE stock in general.
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AMC TTM Squeeze indicator
I gave a quick 6-minute introduction to AMC’s TTM squeeze indicator on my channel last week; you may watch it below in case you missed it.
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But I’m going to be publishing a brand-new video updating the community where AMC stands and what we can expect moving forward based on this indicator, later this week.
Be sure to subscribe to the channel and opt in for notification so you do not miss it when it comes out.
In this article I want to go over the possible BIG rally that may lie ahead for AMC Entertainment stock given the circumstances of specific factors.
One of the biggest being momentum.
AMC saw gains upwards of +3,000% last year when retail investors purchased the stock en masse, which snowballed into FOMO from more retail investors and even institutions.
The reason it worked was because AMC had a high short interest and institutions gained confidence in the opportunity as investors piled in to squeeze short sellers from their short positions.
AMC’s short interest dropped from 23% to 20% before it began to move up.
The stock gained momentum when the short interest further dropped to 14% before picking back up this year.
And luckily for retail investors, AMC’s current reported short interest is at 21.30%.
It’s going to require retail momentum and institutional investor confidence for AMC to surge like it did last year.
This bullish momentum is what triggered a small percentage of short sellers to close their short positions, further fueling the rally.
If AMC’s TTM Squeeze indicator has a complete transition from bearish momentum to bullish momentum, then AMC stock will be taking its first steps towards another massive swing this year.
I will be going over the indicator later this week on my channel for the weekly timeframe update.
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Market News: AMC TA indicates bullish momentum is near
AMC Entertainment stock is nearing a major demand level as share prices continue to decline.
The stock closed at $8.58 on Thursday after hitting a low of $8.30 on the intraday chart.
Volume on Thursday fell below the average of 46.3 million by 20.9 million.
But AMC is treading a fine line as the high $8 and low $9 levels have proven in the past to be a strong support for the stock.
Breaking below $8 could send the price to test a high demand level around $6.50 per share.
In this article I’m going to explain what shareholders should look out for in the next coming weeks.
Let’s get started!
Momentum levels are on the brink of reversing
If you’ve watched one of the latest videos on my channel regarding the TTM Squeeze indicator, then you know all about the massive impact this indicator is signaling.
Watch this quick clip on YouTube – Subscribe for more content and updates.
The TTM squeeze indicator is an indicator that signals heavy buying or selling momentum.
When AMC began to run up before ultimately hitting its all-time high of $72 per share, we see this indicator was already predicting heavy bullish momentum.
TTM Squeeze indicator – AMC stock
The TTM Squeeze indicator is the chart at the very bottom whereas the top is AMC’s price action.
Dark green shrinking candles indicate the stock is on the brink of losing momentum and often times serves as a sell indicator.
We see that as the dark green momentum candles shrunk, AMC’s price action is followed by a massive crash.
Now let’s take a look at what happened when the TTM Squeeze indicator switched from bullish momentum to bearish momentum.
As the indicator transitioned from bullish momentum and began to show signs of bearish momentum, we can see AMC had a drastic drop in share price.
The TTM Squeeze indicator predicts big moves ahead.
A new transition is in play
So where is AMC today?
AMC is actually in a period where bearish momentum has begun to die out, leaving room for buyers to takeover.
It makes sense as AMC’s share price is hovering just above key levels of support, which have also been known as high demand levels.
Below you’ll see the TTM Squeeze indicator shows bearish momentum has completely gone out on the weekly timeframe.
The transition from red to green momentum candles will signify big moves lie ahead for AMC Entertainment stock.
But we’ll need one or two of these weekly timeframe momentum candles to serve as confirmations.
If these candles break through, then it’s a clear indication AMC is on track for some massive price action.
Market News: Short sellers aim at AMC’s newly acquired foundation, APE
Short sellers are targeting AMC’s Preferred Equity (APE), shorting both the companies’ emergency fund, and shareholders’ equity.
APE’s short interest has officially surpassed AMC’s short interest, now reportedly 30.10% via Ortex Data.
During the run to $27 we saw AMC’s SI tumble to 17% signifying released short seller pressure.
However, today we see short sellers have opened new positions, raising AMC’s short interest to 21.17% and creating bearish momentum for the stock’s share price.
Well, the same thing is happening to APE.
Short sellers have targeted AMC’s Preferred Equity hoping to make some cash during a potential meltdown.
But will it be that easy?
After all, there is a big demand for both these stocks – and with enough momentum; well, it could just create two short squeezes.
Let’s discuss it below.
Volume cools leading to the weekend
AMC and APE had big volume at the beginning of the week when AMC’s Preferred Equity debuted on Monday.
In fact, APE has now set a higher average volume than AMC sitting at 71.5 million.
That’s 22.5 million more in average volume than AMC’s.
The excitement over the new ticker has retail investors invested heavily.
But others are quickly trying to kill off any momentum created by the retail scene.
This morning ticker symbol APE rose to 100 in utilization indicating short sellers have now gone into a full blown out short selling spree.
But AMC and APE aren’t the only tickers whose volume or share price cooled down leading towards the weekend.
The entire market played in bears’ favor this Friday.
The SPY fell -2.81%, while NASDAQ fell -2.74%.
SPY has a level of support around $400 and if the market continues to downtrend and breaks this level, it’s very likely we see its next major level of support at $390.
But the market was heavily oversold which means it’s possible we begin to see a nice bounce up to $417-$420.
AMC and APE closed with 35.7 million and 13.6 million in volume respectively on Friday.
Will AMC’s Preferred Equity (APE) go up?
Will APE go up?
AMC and APE currently have approximately the same market cap of 4.7 billion each – due to the split.
The company was able to join the Russell 1,000 in June of 2022 when it managed to meet the $7.3 billion criteria after reaching $7.5 billion before the cutoff time in May.
When AMC reached its all-time high of $72 per share in June of 2021, the world’s largest movie theatre chain grew its market cap to an astonishing $28.44 billion.
AMC’s market cap increased as the value of its share price increased.
How did this happen?
Well, millions of investors began purchasing the stock like crazy – volume was reaching +500 million, +700 million, and +900 million during single trading days.
Once institutions saw there was heavy momentum happening on retail’s end, they began to jump in as well.
In order for AMC or APE to reach all-time high levels, the market cap will have to increase.
Because as soon as momentum picks up again, institutions combined with short sellers buying back their shares will further fuel AMC or APE’s market cap.
Will AMC and APE skyrocket?
This will depend on how valuable the company can become, no matter how fast or how slow it achieves this process.
Why is APE being shorted more than AMC?
According to the reported short interest data provided by Ortex, APE is currently being shorted more than AMC stock.
AMC Entertainment designed APE as a means to raise capital for a rainy day.
The company has access to a fraction of shareholders’ equity should they need to pay off debt or make a worthy investment in another business venture.
APE is a tool that allows AMC Entertainment to not only stay afloat in case of another catastrophic event, but it provides the theatre chain with opportunity to grow and progress.
Short sellers are targeting this massive foundation in hopes of crippling the century old company.
Things didn’t quite work out in short sellers’ favor last year when big bets were being placed against AMC during their bankruptcy announcements.
But retail investors were able to arm the CEO with billions to resuscitate the company, burning those who prophesized the doom of the cinema experience.
Now it seems short sellers are pursuing a vendetta against retail investors and the company.
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