AMC stuck within tight trading range
AMC Entertainment Holdings Inc. Class A (AMC) Technical Analysis Report for Sep 16, 2020 | by Techniquant Editorial Team
AMC ended Wednesday at 5.76 gaining $0.24 (4.35%), notably outperforming the S&P 500 (-0.46%). Closing within the previous day's range, prices missed to decisively move beyond the prior day's trading range.
Daily Candlestick Chart (AMC as at Sep 16, 2020):
Wednesday's trading range has been $0.46 (8.33%), that's slightly below the last trading month's daily average range of $0.56. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for AMC. Prices continued to consolidate within a tight trading range between 5.42 and 5.88 where it has been caught now for the last three trading days.
In a volatile session, prices traded above the previous day's high as well as below the prior day's low, forming a bullish Outside Bar. Regardless of a weak opening the market managed to close above the previous day's open and close, forming a bullish Engulfing Candle. Additionally, one bullish candlestick pattern matches today's price action, the White Candle. The last time a White Candle showed up on September 1st, AMC gained 15.98% on the following trading day.
Buyers managed to take out the key technical resistance level at 5.68 (now S1), which is likely to act as support going forward. The stock ran into sellers again today around 5.88 for the third trading day in a row after having found sellers at 5.87 in the prior session and at 5.87 two days ago.
While the share is currently in a short-term downtrend, this might just be a correction, as both the medium and long-term trends are still bullish.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bullish Outside Bar" stand out. Its common bullish interpretation has been confirmed for AMC Entertainment. Out of 73 times, AMC closed higher 56.16% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the long side has been after 10 trading days, showing a win rate of 53.42% with an average market move of 3.33%.