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AMC stock price prediction: What comes first $40.00, or $60.00?

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Elliott Laybourne Crypto Expert
    Summary:
  • Last week, the AMC stock price broke down and out of its narrowing triangle formation. But the resulting sell-off was hardly a bloodbath. So what's next?

Last week, the AMC stock price broke down and out of its narrowing triangle formation. But the resulting sell-off was hardly a bloodbath. So what’s next?

AMC Entertainment Holdings Inc (AMC: NYSE) finished Friday at $51.96, down $2.26 (-4.17%).

It was always a case of when, not if, the AMC stock price would breakout from its narrowing range. What wasn’t known was which direction the price would choose.

Last Thursday, when the price closed below $56.00, the downside break was confirmed. Furthermore, the stock lost another 15% before bouncing from $47.77 and recovering into the close on Friday.

This could be considered a fairly muted reaction, considering the stock’s meteoric rise.

It seems as though the AMC stock price is almost at a stalemate. The short interest of 17% is not enough to attract new buying. However, it’s probably enough for the WallstreetBets crowd to maintain a diamond-handed grip on their long positions.

This has seen AMC lose momentum on Reddit’s retail investor forum. It is now the 9th most popular topic of conversation on the Sub, behind SoFi Technologies, and accounts for around 5% of mentions.

As its popularity fades, it seems the price follows. This could put AMC on a path to $40.00. However, it will take a braver investor than myself to bet against the Reddit crowd.

AMC Entertainment Outlook

The 4-hour chart clearly shows that the rising trendline supporting the price for most of June gave way last week. This has left the descending trend from the 2nd of June high at $72.62 as the dominant indicator on the chart.

A logical downside target for shorts is the $37.50 -38.50 range. Around $38.50, we see the 100 period average on the 4-hour chart, and interestingly the 50-day moving average on the daily chart. Furthermore, $37.50 offers a strong horizontal support area from the open on June 2nd and the low on June 3rd. Therefore, this should be viewed as an important area.

Given the significance of the descending trendline, this is the first crucial resistance. The line is now visible at $58.95. As long as the AMC stock price remains below this barrier, the bias is likely to remain negative. However, if the price scales this trendline, it would signal the game is very much afoot.

AMC Stock price chart (4-hour)

amc stock price

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