Warning: Use of undefined constant PM_VERSION - assumed 'PM_VERSION' (this will throw an Error in a future version of PHP) in /home/kincenet/public_html/stocktradingteacher.com/wp-content/plugins/stock-calculators/index.php on line 25

Warning: Use of undefined constant PM_VERSION - assumed 'PM_VERSION' (this will throw an Error in a future version of PHP) in /home/kincenet/public_html/stocktradingteacher.com/wp-content/plugins/stock-calculators/index.php on line 26

AMLH Stock: Is American Leisure Holdings a Stock Option?

AMLH Stock Price

AMLH stock has appeared in the news a lot lately, yet it is a little-known company. American Leisure Holdings Inc. is legally registered in Colorado, Denver. The company’s primary industrial classification is real estate. 

However, according to Yahoo Finance, the company operates a business developing software applications in Web 3.0, Blockchain technology, cryptocurrencies, and Non-Fungible Tokens (NFT). Bloomberg reports the company owns and manages hotel and vacation properties throughout the US and the Caribbean.

Let’s take a closer look at AMLH stock in the news more recently and some technical analysis on the stock price action. Then we’ll answer the question asked in the title.

AMLH Stock News

New Technology Strategist

As of March 29, 2022, American Leisure Holdings announced it was adding long-time technology innovator Jonathan Herman to the team. Herman brings a wide collection of experience in the field of technology, with a few accolades for his main projects.

In 2016, Herman helped launch Bocazon, a major e-commerce platform for the region of Panama, Colombia, and Costa Rica. The company was voted start-up of the year in Miami Beach Florida. It was also the first company to accept crypto payments across multiple big-ticket shopping categories.

Herman also leads another start-up, Baller Mixed Reality, a company pioneering autographed NFTs of legendary athletes and entertainers. Baller is the first company to create and release 3D augmented reality (AR) NFTs to be used with AR-enabled devices.

The addition of someone with Herman’s profile would lead you to expect an expansion of the company into the technology industry, more in line with the activities of the company as reported by Yahoo Finance.

The NFT industry is expanding and gaining more traction, especially among millennials and generation Z. Some estimates put the buying power of this generation at $44 billion, and you can expect that to increase as the youngsters advance in their careers.

According to Reuters, the NFT sales generated $25 billion in the full year of 2021. More noticeably the total NFT sales for 2020 were a mere $94.9 million. The rise in NFT sales materialized in the second half of 2021. As the chart shows below Q3 and Q4 totaled $23.3 billion in sales.

AMLH Stock NFT Sales

Source: Reuters

New Issue of Shares

In March of 2022, American Leisure Holding Inc. issued a public offering of 2.5 million shares. The offered price was between $0.0005 and $0.008. The immediate reaction to this type of news is that the stock’s price will suffer as the value of each share is diluted by the addition of a large number of new shares. 

According to the SEC filing for the public offer of shares, AMLH has 6.192 million shares outstanding. That number is counting the 2.5 million shares of the public offering. In theory, the share price of AMLH stock could have been pushed further south, yet the stock’s price has held its ground.

AMLH Stock Goes OTC

On August 26, 2021, American Leisure Holdings revealed it had filed to have its shares quoted and traded over the counter (OTC). OTC trading requires lower standards of reporting by the company but comes with some perks for a retail trader.

OTC trading is conducted away from a centralized exchange. There is no physical building where all the participants in the market meet. Prices are quoted by dealers who can be in very different parts of the world.  

The OTC is not restricted by exchange open hours. So, if a dealer is willing to quote a price for AMLH stock you can trade this security at any time. You may also find dealers willing to quote in smaller minimums than those imposed by exchanges.

However, in an OTC market transparency is lower compared to an exchange. You will also find there are no automated mechanisms to stop trading when large price swings occur. Exchanges have systems in place to halt the trading in a stock when its price reaches acute highs or lows. 

Putting a pause on trading allows other participants to join in the market. And this usually results in the price of the stock cooling down. Due to the characteristics of the OTC marketplace, it is usually populated by small corporations.

AMLH Stock price

Let’s have a look at the price action for AMLH stock over the most recent past. We’ll take a look at 3 technical indicators and how they are aligned as well as considerations on candlestick patterns. The AMLH stock price started the year with a strong rally. 

On January 3, the stock opened at $0.0044 and rallied to a year high of $0.0055 on January 5. Its price then plunged to its recent lows of $0.001, where it has been drifting sideways, with most price action between $0.001 and $0.0018

AMLH Stock YTD performance

Source: TradingView

AMLH forecast

The 3 technical indicators we are going to examine are the Ichimoku Cloud, the Aroon, and the Moving Average Convergence Divergence (MACD). Looking at the day chart shown below, we can see that the price of AMLH stock pierced the belly of the Ichimoku Cloud in mid-January and has remained below it since.

AMLH stock YTD technical indicators

Source: TradingView

The Aroon indicator shows the trend is still downwards, but losing momentum, as the down and up lines are close to converging. The MACD shows the start of an upward trend indicated in the last week of February is showing signs of exhaustion.

The picture we get looks like there is a period of uncertainty, while the market figures out what the repercussions are of the latest news for this company. Technically, from the day chart, we see a continuation of the sideways trend that has been ongoing since mid-February.

Is American Leisure Holdings a Stock Option?

What do we mean by this question? Well, the question arises because the price of the stock is so low. In fact, with a few hundred dollars you can buy hundreds of thousands of this stock. If you did so, your maximum risk would be the few hundred dollars you invested in the position.

You can look at buying this stock like buying a call option, meaning if the stock doesn’t rally, or goes bust, you will have lost the investment. But if it does rally you will reap all the rewards multiplied by hundreds of thousands of shares. 

You also have no expiry, which stock options do have, so your option is valid as long as the company is operating. This factor of no expiry is extremely valuable when trading options. Time decay plays against buyers of options and works in favor of the option seller.

Bottom Line

You can trade AMLH stock like any other low liquidity OTC stock. Where you take your position and hold it for a few days to see if you reap a reward. However, this stock is extremely volatile, as we have seen above.

Think that when it goes from $0.001 to $0.0018 it is moving a small fraction of cents, precisely $0.0008. That is a tiny number, but it represents an 80% increase in price. Price swings are sharp, and the lack of liquidity may mean you cannot exit your position at the price you see at the moment or when you want.

Always speak to a financial advisor before you invest in any stocks to determine if it’s a good choice for you. Picking your own stocks is never easy, as there are a myriad of factors to consider. Several companies can help you in picking stocks, so we recommend checking out our stock picking service reviews here.