#AMCApes, here is a quick and dirty warning to be wary of the days ahead as AMC shares are at the third major break or break point of the year. The first point, as you know, is when AMC was hemorrhaging money, in danger of going bankrupt, and the #ApeArmy decided to #SaveAMC and execute a short squeeze on huge buying. After the initial short squeeze, AMC’s share price consolidated to from a symmetrical triangle, typical of a major price movement, and heavy buying ensured that the breakout was higher, not lower. We are at the third such critical point for AMC’s share price this year with the share price once again forming a symmetrical triangle price consolidation pattern, much like the first time, after a second huge run higher in share price to nearly $73 a share.
However, due to the MACD crossing below its signal line at the end of this past July and remaining bearish ever since, the possibility that this symmetrical triangle pattern could yield a break to the downside instead of the upside, as was the outcome of the first symmetrical triangle pattern, is much higher. Unfortunately, as it stands right now, the run of the #AMCApes appears that it may be closer to the end than to another massive short squeeze higher at this current time on 9 November 2021. And if a break to the downside happens, which appears more likely than not, unless the #AMCApes really show very strong resolve in the first instance in which their resolve will face a real test, a decline to the 200dma would be within the realm of the immediate decline, in my opinion, especially since well-known AMC CEO Adam Aron, has been slow to move AMC’s business model from its dinosaur theatrical model that Covid lockdowns practically killed during the majority of 2020 and 2021. Thus far, Aron has only instituted minor changes, such as allowing the consumer to purchase AMC theatrical releases on Premium Video On Demand (PVOD) on an expedited 17-day after theatrical releasse timeline versus the prior 90-day model.
In my opinion, Aron should have been burning the midnight oil to make radical changes in AMC’s operational model to quickly adapt in response to the devastation of Covid Lockdown measures within months after being handed a lifeline by the #AMCApes way back in January of 2020. It should not have taken nearly a year to announce that major operational changes are on the way. However, it is yet to be determined if CEO Aron’s move to a more heavily digital streaming distribution model, one foreseen by Netflix well over a decade ago, will be too late.
