'Should I Be Worried About My AMC Stock?' Asks a Reader

Grab some popcorn for my thrilling answer... er, spoiler ... here. It's a real cliffhanger.

A  Real Money subscriber sent me an email worried about a long position in AMC Entertainment Holdings (AMC) . The problem was, the reader was long from much higher levels. Let's check out two charts. 

In this daily Japanese candlestick chart of AMC, below, we can see some subtle improvement. Prices are still below the declining 50-day moving average line but we can see that prices have crept a little higher this month. The On-Balance-Volume (OBV) line is quietly inching higher and tells us that there are some buyers of AMC who are being aggressive.

The Moving Average Convergence Divergence (MACD) oscillator has crossed to the upside from below the zero line. This is a cover-shorts buy signal. Today's candle looks like it could make a slight new high which could set the stage for further gains.  

 

 

In this daily Point and Figure chart of AMC, below, we can see a potential upside price target in the $56 area. 

 

 

Bottom line strategy: It looks like this subscriber will get a rally in AMC, but the question is whether it will be enough to "break even." 

Employees of TheStreet are prohibited from trading individual securities.