When AMC and GameStop surged in share price back in January of 2021, retail investors on Reddit weren’t worried about dark pools or market manipulation.
They knew that in numbers they could increase the market capitalization, and in turn, increase the share price and collect big profits.
My favorite part of Reddit was seeing all the incredible gain porn.
If you’ve been part of the ape community since the beginning, you know exactly what I’m talking about.
Seeing investor’s gains on Reddit was both desirable and exciting, I mean who wouldn’t want a piece of the action?
So, did market makers and hedge funds all of a sudden decide to start manipulating the stocks after January?
So, what caused AMC to skyrocket in 2021, and why hasn’t it skyrocketed again since?
Here’s what’s stopping AMC from squeezing today.
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Dark pools and off exchange trading?
Are dark pools and off exchange trading the reason why AMC has not squeeze yet?
See, dark pools and off exchange trading have unfortunately been unfair suppression retail investors have no control over.
These loopholes did not magically appear after January’s runups; they’ve always been there.
While majority of retail investor’s orders are not processed through the lit exchange, high volume has always had a positive effect for investors going long.
As a collective, the small percentage that is processed through the lit exchange accumulates to create the momentum necessary to drive prices upward.
And Redditors on r/wallstreetbets knew this.
All they needed to know was that these stocks were heavily shorted in order to create a short squeeze from fueled buying momentum.
AMC gained attention in January when it surged from $2 per share to $22 per share.
But we noticed many short sellers were still hanging around, so we advised to the public of the possibility at hand.
Months later AMC surged to $72 per share and it was all due to the massive crowd of retail investors who purchased the stock.
AMC was having 500,000,000 to 900,000,000 volume days.
Why Hasn’t AMC Squeezed Yet?
Speaking of volume, AMC’s current average volume today is 26.5 million.
Recently, AMC’s trading volume has surged by twice its average volume.
Today’s economic downturn has made it difficult for retail investors across the entire market to fork out money to buy stock.
The lack of liquidity then triggers financial institutions to further sell assets for capital – which in turn drives stocks lower.
Why hasn’t AMC squeezed yet?
What’s stopping AMC from squeezing today is the lack of buying pressure from retail investors as a unit.
By that I mean BIG buying pressure, not the buying pressure we’re seeing today.
Yes, of course shareholders continue to buy the stock today.
The difference is MORE retail investors were buying AMC stock in 2021.
But this doesn’t mean the short squeeze is over, far from it.
It just means market conditions have to change from bearish territory to bullish territory.
In fact, out of nearly 4,000 market participants, 93% said they were still planning to hold AMC shares in 2023.
From $2-$22, From $14-$72, From $5 to What?
Retail investors took AMC from $2 to $22 together.
As a unit, they also took the stock price from $14 to $72 per share.
So, what’s next?
Will retail investors decide to take AMC from $5 per share to the next level?
Time will certainly tell.
At the moment, it seems AMC has bottomed out around $4-$5 per share.
And the stock continues to be a trending topic amongst many social media outlets.
One thing is certain, retail investors aren’t going anywhere anytime soon.
Latest AMC Stock News and Updates
The movie theatre industry is no longer struggling to attract movie lovers back to the big screen.
While pandemic lockdowns threatened the existence of thriving cinemas, rapidly growing numbers of attendees have continued to grow over the past two years.
The only thing movie theatres are missing is more movie titles, says CEO of AMC Entertainment Adam Aron.
As “Avatar: The Way of Water” gets closer to the $2 billion mark at the worldwide box office, James Cameron says it’s a reminder that moviegoers still value the theatrical experience in an era of streaming dominance.
“I’m thinking of it in the terms of we’re going back to theaters around the world. They’re even going back to theaters in China where they’re having this big COVID surge. We’re saying as a society, ‘We need this! We need to go to theaters.’ Enough with the streaming already! I’m tired of sitting on my ass. Source: Variety.
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