Live Nation Entertainment Stock Could Resume Path Higher

The equity looks ripe for a short squeeze, to boot

Digital Content Manager
Jun 16, 2021 at 3:14 PM
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The shares of Live Nation Entertainment, Inc. (NYSE:LYV) are up 1% at $86.80 at last check, after the entertainment concern yesterday appointed Joe Berchtold as CFO. Plus, ASM Global said it expanded its partnership with Ticketmaster by enabling the company to conduct ticket sales for Live Nation-promoted shows. The equity is already up 75.8% year-over-year, and is fresh off a March 3, record high of $94.63. The even better news is that LYV has recently pulled back to a trendline with historically bullish implications, indicating the stock could soon climb back up the charts.

Specifically, the security just came within one standard deviation of its 80-day moving average, after spending roughly one month above this trendline. According to data from Schaeffer's Senior Quantitative Analyst Rocky White, 10 similar signals have occurred in the past three years. Live Nation stock enjoyed a positive return one month later in 70% of those cases, averaging a 7.3% gain. From its current perch, a similar move would put LYV over the $93 mark, which is just shy of the equity's record peak.

LYV 80 Day

A short squeeze would keep the wind at the equity's back. Short interest rose 10.1% over the most recent reporting period, and the 12.95 million shares sold short now make up for a significant 8.6% of the stock's available float, or nearly two weeks' worth of pent-up buying power.

Now seems like a good opportunity to weigh in on Live Nation stock's next move with options. The security's Schaeffer's Volatility Index (SVI) of 34% sits in the extremely low 1st percentile of its annual range. This means options players are pricing in low volatility expectations.

 

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