Meme stock AMC surges 12% on hedge fund short!

Avgust 13, 2021 12:48

Meme stocks are back in focus. One of the favourites from the Reddit crowd has been AMC Entertainment Holdings. The stock recently surged 12% higher on news that hedge fund veteran Odey Asset Management went short the stock and was up nearly 30% this week before settling lower today.  

Retail investors that focus on meme stocks often find the companies that are being heavily shorted to try and short squeeze them. From the lows of this year to the highs of this year the stock surged more than 4,000% higher.  

However, the stock is now down more than 60% from those highs, so it is extremely volatile.  

Source: Admirals MetaTrader 5, #AMC, Monthly - Data range: from Dec 1, 2013, to Aug 13, 2021, performed on Aug 13, 2021, at 8:30 pm GMT. Please note: Past performance is not a reliable indicator of future results. 

AMC shares are now trading at an interesting technical level, retesting the highs of 2014 and 2016. The $35.50 price level previously acted as resistance and now could turn into support.  

Due to the extreme volatility in this stock, traders may look for additional clues on lower timeframes to confirm if buyers are regaining control.  

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Jitanchandra Solanki
Jitanchandra Solanki Financial Markets Author, Admirals London

Jitanchandra is a financial markets author with more than 15 years experience trading currencies, indices and US equities. He is an accredited Market Technician with a BA Hons degree.