AMC’s short interest is rising again.
Last week the movie theatre chain’s short interest was around 17%, according to Fintel.
Now we’re seeing a sharp rise in shorting as the stock begins to move upwards again.
AMC shares are currently up +44% in the past month, with a recent high of $9.15 per share.
Shares went as low as $5.05 but the heavy demand zone around $6 levels were able to create a bounce.
Will AMC share prices continue to rise?
Let’s discuss it.
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The Markets in General Are Bouncing
The SPY has created a triple bottom around the $360 level so far and hasn’t come down since.
First in June, again in September, and last in October.
October is the month when SPY began to bounce from this major level of support.
Around the same time, AMC Entertainment stock was having a bounce from its major level of support around $6.30 per share.
Is it possible the market in general has hit the bottom?
It’s very probable, although it’s fair to mention any official talks of a recession can easily crash the market.
If we do begin to see further continuation, we might enter a short squeeze season where stocks begin to have sudden price surges from shorts closing positions.
Last year, AMC and GameStop gained mainstream attention when retail investors began to buy heavily into these two ‘meme stocks’ despite their high short interest.
Users over at Wall Street Bets identified that with enough buying pressure, they could force short sellers to rush and close their short positions in order to refrain from taking on massive losses.
This buy-back of shares would further fuel the buying pressure already being applied from retail investors; GameStop shot up over $483 per share.
In June of 2021, AMC Entertainment stock surged from $14 per share to $72 per share.
Will History Repeat Itself?
AMC’s short interest was around 21%-22% before short positions began to get closed.
AMC’s current short interest is at 21.64%.
This means that with enough buying pressure, retail investors might just have the chance to recreate the events that occurred last year, possibly even bigger.
But I’m curious to hear your thoughts on AMC’s rising short interest today.
Leave your thoughts below.