AMC Entertainment (AMC.US) stock surged nearly 8% in premarket, however buyers failed to uphold upward momentum after the start of the session. The movie theater chain beat second-quarter revenue estimates as movie fans returned to its theaters after a year of closures and restrictions. Also the company posted a quarterly loss of 71 cents per share, while analysts expected 91 cents a share loss. CEO Adam Aron said during an earnings call Monday that the company will have the IT systems in place to take the cryptocurrency as payment by the end of 2021. This will be a combination of two highly speculative assets — bitcoin, known for its volatility, and AMC, which became a meme stock star favored by retail traders from Reddit. AMC also announced a deal with Warner Bros for an exclusive movie release period for cinemas. While the quarterly figures beat market expectations, the company still posted a huge loss and some analysts are concerned that the spread of the Delta variant may lead to the reintroduction of restrictions, which could again adversely affect the company's future results. Also many believe that AMC shares are overvalued, with the median price target on the stock at $3.70.
AMC Entertainment (AMC.US) stock launched today’s session with a bullish price gap, however buyers failed to break above 200 SMA (red line) and price pulled back towards local support at $35.10 which coincides with 61.8 Fibonacci retracement of the last upward wave. Also medium-term 50-day SMA (green line) crossed below the long-term 200-day SMA (red line). This has formed a bearish ‘death cross’ which can at times precede a move lower. The next target for sellers is located around $24.60. Source: xStation5
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