AMC Makes A Trend Change For The Bulls, Options Traders Hammer Calls

AMC Entertainment Inc AMC became the top holding in Millennial and Gen Z accounts in the second quarter, up from sixth place in the first quarter according to Apex Clearing. AMC is also the top holding in the iShares Russell 2000 ETF IWM at 0.78%.

The stock has, so far, struggled to rebound back toward its June 2 high of $72.62, which could be partly due to the Russell 2000 being unable to make a new all-time high. Unlike the SPDR S&P 500 SPY and the Nasdaq, which both reached new all-time highs on Monday, the Russell 2000 has lagged its counterparts by failing to break above $234.53 and get a blue sky run.

On Monday AMC was trading up over 6% but struggled at a resistance level near the $40 mark. The stock is currently in a daily uptrend and needs to clear $46.55 to put in its next higher high.

Options traders believe AMC will jump above the resistance level in the coming weeks and months with a few even betting AMC could reach $100 or higher by December. Together the traders purchased well over $3.16 million worth of bullish call contracts. The trades below were filtered to include only orders with a total purchase price over $50,000.

See Also: How to Buy AMC Stock Right Now 

Why It’s Important: When a sweep order occurs, it indicates the trader wanted to get into a position quickly and is anticipating an imminent large move in stock price. A sweeper pays market price for the call or put option instead of placing a bid, which sweeps the order book of multiple exchanges to fill the order immediately.

These types of option orders are usually made by institutions, and retail investors can find watching for sweepers useful because it indicates “smart money” has entered into a position.

The AMC Trades: Below is a look at the notable options alerts, courtesy of Benzinga Pro:

• At 9:30 a.m., a trader executed a call sweep near the ask of 800 AMC Entertainment options with a strike price of $38 expiring on Aug. 6. The trade represented a $400,000 bullish bet for which the trader paid $5 per option contract.
• At 9:34 a.m., a trader executed a call sweep near the ask of 300 AMC Entertainment options with a strike price of $40 expiring on July 30. The trade represented a $60,300 bullish bet for which the trader paid $2.01 per option contract.
• At 9:34 a.m., a trader executed a call sweep near the ask of 292 AMC Entertainment options with a strike price of $38 expiring on July 30. The trade represented a $85,556 bullish bet for which the trader paid $2.93 per option contract.
• At 9:38 a.m., a trader executed a call sweep near the ask of 595 AMC Entertainment options with a strike price of $40 expiring on July 30. The trade represented a $159,460 bullish bet for which the trader paid $2.68 per option contract.
• At 9:47 a.m., a trader executed a call sweep near the ask of 584 AMC Entertainment options with a strike price of $40 expiring on July 30. The trade represented a $102,200 bullish bet for which the trader paid $1.75 per option contract.
• At 10:10 a.m., a trader executed a call sweep near the ask of 505 AMC Entertainment options with a strike price of $41 expiring on July 30. The trade represented a $112,110 bullish bet for which the trader paid $2.22 per option contract.
• At 10:39 a.m., a trader executed a call sweep near the ask of 350 AMC Entertainment options with a strike price of $10 expiring on Jan. 21, 2022. The trade represented a $1.06 million bullish bet for which the trader paid $30.50 per option contract.
• At 11:07 a.m., a trader executed a call sweep near the ask of 400 AMC Entertainment options with a strike price of $100 expiring on Dec. 17. The trade represented a $232,000 bullish bet for which the trader paid $5.80 per option contract.
• At 11:07 a.m., a trader executed a call sweep near the ask of 200 AMC Entertainment options with a strike price of $100 expiring on Dec. 17. The trade represented a $116,000 bullish bet for which the trader paid $5.80 per option contract.
• At 11:08 a.m., a trader executed a call sweep near the ask of 280 AMC Entertainment options with a strike price of $100 expiring on Dec. 17. The trade represented a $162,400 bullish bet for which the trader paid $5.80 per option contract.
• At 11:15 a.m., a trader executed a call sweep near the midpoint of 717 AMC Entertainment options with a strike price of $120 expiring on Dec. 17. The trade represented a $333,405 bullish bet for which the trader paid $4.65 per option contract.
• At 11:18 a.m., a trader executed a call sweep near the ask of 200 AMC Entertainment options with a strike price of $100 expiring on Dec. 17. The trade represented a $116,000 bullish bet for which the trader paid $5.80 per option contract.
• At 12:16 p.m., a trader executed a call sweep near the ask of 200 AMC Entertainment options with a strike price of $40 expiring on Aug. 27. The trade represented a $160,000 bullish bet for which the trader paid $8 per option contract.
• At 3:13 p.m., a trader executed a call sweep near the ask of 200 AMC Entertainment options with a strike price of $39 expiring on July 30. The trade represented a $67,000 bullish bet for which the trader paid $3.35 per option contract.