Amc News

AMC stock price exploded higher as investors cheered the opening of two of the best-performing theatres in Los Angeles. But will the latest surge last? AMC Entertainment Holdings Inc (NYSE: AMC) ended the day at $43.09, higher by 8.47 (+24.47%) Last week I incorrectly called AMC shares lower, suggesting the bears were in control. For a brief moment, it appeared I had it right. However, yesterday's rally suggests I may have not. Late on Monday AMC gave investors a glimmer of hope that some normality may soon return to the business. AMC said it will reopen the Grove and the Americana, two of Los Angeles' highest-grossing cinemas. "The Grove and The Americana at Brand theaters are among the most successful theaters in the greater Los Angeles area." AMC CEO, Adan Aron Whilst this is clearly good news, it hardly justifies the AMC stock price reaction. However, after losing 52% over the last month, short sellers may have become complacent. And although the short position has reduced by 4 million shares over the last week, significantly, 75.84 million shares, 15% of the available float, remain short. AMC entertainment Looking at the daily chart we can see that last week AMC broke down from a descending triangle pattern. The selling accelerated as the price breached the lower end of the formation at $38.70 and AMC subsequently lost a further 18% in the three days following. Furthermore, the drop took the price below the 50-day moving average at $39.47, although AMC reversed from $31.15 on Monday. After yesterday's explosion, the AMC stock price has reclaimed both the 50 DMA and the support of the trend line, now at $39.15. Furthermore, the Relative Strength Indicator (RSI) is turning higher from last week 'close to oversold' reading and now pointing north. Notably, AMC Entertainment was the second most-traded stock on the NYSE yesterday with almost 170 million shares changing hands. This suggests either the shorts are covering, or the longs are adding. But until the next short position data is released, we won't know for sure. As with all meme stocks, providing an AMC stock price prediction involves a certain amount of guess-work. And in my experience, guess-work is not always the best trading strategy. However, basis the price performance alone, it suggests AMC should advance to the descending top-edge of the triangle at $50.70. And considering the high short interest, it's certainly a possibility. Although, should the price lose the support of the trend line and the 50 DMA, I may finally be proved right. AMC stock price chart (Daily) Follow Elliott on Twitter.

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