Another meme stock, another dollar (to lose, in this case)...
This is another one where volume has broken out and above the previous consolidation zone in white with volume, HOWEVER, it did so on LOWER volume than the previous high. Which means that volume has diverged.
Now, this is NOT a complete deathblow to AMC as of yet, because several different things have to happen for it to be a dead cat.
First off, if you're in AMC... Don't be, at least not yet. If you are in a long position from this $30-$50 consolidation zone AMC has been in the past few months, this is a good time to just stop loss and walk away. There are better places to enter a trade because it's not looking too great right now.
First off, I do expect a drop to the $20 range to test the top of the last trading range. This happens all the time.
If you want to try for a long position there, I would definitely keep four eyes on what the volume is telling you once the previous higher high gets touched or broken. If we fall below it on high volume, that's all she wrote for AMC. If we fall below it on low volume, there is a long play to be had that you can ride back to $70 or possibly a new ATH.
If we get that new ATH after the retrace, you will need to pay attention to volume, because if we keep getting higher highs on lower and lower volume, that will immediately tell you that the fun on this meme stock is coming to an end.
Be really careful on this stock. Frankly, I wouldn't touch it with a stick right now if I were you.
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Ok guys, quick update. My analysis was somewhat incorrect.... I do actually see at least a double top happening with AMC, after further analysis.
Pay attention to everyone’s emotions. Would I be wrong to say that everyone holding the stock is feeling defeat right now? They literally killed everyone’s fractal theory earlier this month and it was hilarious because it was almost annoying hearing everyone saying “WeRe iN mAy 24Th” These next 2 and half weeks are going to be some of the toughest and most mentally draining days we’ve ever been tested on this play. My only words of encouragement left as someone who’s been here since January is that we are literally so fucking close and nobody has a fucking clue. This shit is ABOUT to happen. You’ve all been preparing for this moment of your life for the last 9, 6, 3 months… whenever you got in it doesnt matter. It doesn’t matter how many shares you hold, how long you’ve held, if you scalp or trade the options. We’re about the end this phase of AMC and some of us will move on into other plays and some of us will continue to trade this thing.. but the mission is already over and I have a feeling were gonna see a lot of winning apes real soon. Stay strong and hodl on amc.nfa
Zulu_Kilo
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@ary2001, just so you understand. I'm not at all crapping on AMC hodlers one bit. I'm just strictly stating what I'm seeing from a technical perspective on a chart. Nothing else.
The only other thing I wanted to touch on is "emotional trading"... I'll be the one to say it... Institutions FEED off of emotion. Trading on emotion is literally the worst thing one can do, because frankly, they don't care about your emotions. As a matter of fact, your emotions make the institutions money. And if they're the ones making the money off you, that means you're giving them that money. The markets don't care about offending you, even more so, they want to offend you as much as possible. The more they screw with emotional investors, the better off they are.
@Zulu_Kilo, exactly. scary to see how much emotion was in the previous comment.
ary2001
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bollocks. respectfully, bollocks sir
Zulu_Kilo
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@ary2001, Lol. At least it was respectful. I can't deny that.
Just wondering to myself, what are you seeing that I'm not, good sir?
mbonce
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@Zulu_Kilo, the underlying market mechanics behind the play, the massive institutional buying evidenced by continual increased 13F filings, and HV divergence isnt a thing
Zulu_Kilo
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@mbonce, "underlying market mechanics".... Ok - explain that to me. Not with opinion, but with on the screen type proof.
Let's talk about 13F fillings... You do realize that institutions short with their shares and lend out their shares to short with.... Right? So increasing stock positions doesn't mean absolutely jack squat...
HV divergence?
You mean VOLUME divergence.... And volume divergence is most absolutely definitely a thing. As a matter of fact, it's more of a "thing" than whatever you're going to claim your proof is about "underlying market mechanics"...
Just throwing that out there...
mbonce
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@Zulu_Kilo, Hvol stands for Historic Volatility no? 13F filings show institutions increasing their positions in aggregate, so not lending. Mechanics dont show on charts, sorry
Zulu_Kilo
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@mbonce, They don't have to lend. But aggregate position increase is still increasing stock ownership that can be shorted without lending. As a matter of fact, THAT IS THE ONLY WAY INSTITUTIONS SHORT. They don't short on margin like retail...
I think the biggest thing to take away from 13F filings is that when we are looking at it from a retail perspective, we tend not to think of how they use their shares. Seeing an institution increase shares doesn't necessarily mean accumulation is happening.
PS - the HV on this particular indicator doesn't actually stand for historical volume, but I can see where you would think that, and if that was the case, you would be correct. The "H" on that indicator actually stands for a heatmap type of volume so larger than normal volume can more easily be seen on the volume indicator. But it is strictly volume, not historical volume.
Would I be wrong to say that everyone holding the stock is feeling defeat right now? They literally killed everyone’s fractal theory earlier this month and it was hilarious because it was almost annoying hearing everyone saying “WeRe iN mAy 24Th”
These next 2 and half weeks are going to be some of the toughest and most mentally draining days we’ve ever been tested on this play. My only words of encouragement left as someone who’s been here since January is that we are literally so fucking close and nobody has a fucking clue. This shit is ABOUT to happen. You’ve all been preparing for this moment of your life for the last 9, 6, 3 months… whenever you got in it doesnt matter. It doesn’t matter how many shares you hold, how long you’ve held, if you scalp or trade the options. We’re about the end this phase of AMC and some of us will move on into other plays and some of us will continue to trade this thing.. but the mission is already over and I have a feeling were gonna see a lot of winning apes real soon.
Stay strong and hodl on amc.nfa