Yeah definately a short - I went short 14000 shares last week....

Yeah definately a short - I went short 14000 shares last week.

My technicals indicate that AMC is looking vulnerable in the short term, as it is approaching the top of a multi year trading range. Initial 12 week target of $6.36.

Technical Case
AMC has been trading in a long term sideways channel dating back to 2004. After a fall from grace in April 2004 the stock has moved within a consistent trading range with rallies from the $6.50 level failing around the $7.70 level in a reliable fashion. $7.70 forms a strong resistance barrier, however a break above would be bullish. Immediate support lies at $7.00.

Fundamental Case
AMC has been hit by a $200m lawsuit by Maurice Blackman Cashman over price collusion. Rival company Visy Industries has admitted that it colluded with Amcor to fix the price of cardboard boxes. In light of this confession, the prosecution certainly has a case.
In April 2007, the company announced a major repositioning program for its flexible packaging operations in Europe. The company will close plants, cut 900 staff from its workforce and sell what it considers non-strategic operations. The company has also introduced clauses in its sales contracts to cover energy costs. 70% of volumes manufactured are now covered by this hedging initiative. With oil prices rising to all time highs it remains to be seen just how much of an impact this will have, especially if AMC is found guilty of price collusion. The risk is that the company's restructuring plans begin to show results.