AMC Technicals Point Much Lower

2022年1月15日

Using Fibonacci extensions, the likely target in the next couple weeks is about 7.00 to 12.00 for AMC stock. In applying the extensions, begin with the November 8, 2021 high on the daily chart and trace the first segment of the extension to the December 14, 2021 low. The retracement / bounce (ending December 21, 2021) carries higher to approximately 32.23: from this peak at 32.23, the extension then projects a parallel move downward from the November 8—December 14 move. The 100% extension ends at approximately 7.00.

Fibonacci analysis is not always perfect, but it can provide some sort of framework for reasonable estimates.

Elliot Wave analysis also supports an impulsive downward wave structure. The recent bounce ending December 21, 2021, appears to be a 3-wave (subwave) countertrend, which implies strongly that it was a corrective move that temporarily retraces the primary (impulsive) downtrend.

Momentum indicators point clearly to more pain ahead. They are well below zero, and trending below moving averages of the main indicator lines. RSI is trending lower, and looks to be making new all-time lows, and it is tightly remaining below 45, which suggests a strong downtrend as well.

I realize the pain has been great for buy-and-hold investors. But just when investors believe a stock or security cannot fall further, it often does. Just as momentum carries stocks higher that have already climbed (see AMC's meteoric rise in 2021), negative momentum also carries stocks much lower even after they have fallen dramatically.

2022年1月28日

交易結束：目標達成

Upper end of target range reached. I think AMC is due for a bounce in the coming weeks, but it may head lower and test the single digits first -- or it may not. Long term, I remain bearish, but in the short term, a little more downside may be in the cards before a bounce.