AMC is a NO GO right now, expect drop to $20 for NYSE:AMC by Zulu_Kilo

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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