Hi Reid,
Hope you have a safe and peaceful New Year.
RIMM has once again caught my attention as a short (that P/E just keeps drawing me back!). As I had been hoping, RIMM has now set up pretty nicely, correcting back upwards towards its moving averages, and forming a narrow-range reversal candle on Friday smack in the middle of the 25 day Bollinger bands:
207.61.23.99
This point coincides with resistance in the form of the horizontal 100 day ema, and also previous chart resistance at about 80, suggesting that a failure here is probable:
askresearch.com
Besides the technical weakening in the daily chart, the intraday chart shows signs of weakening as well:
askresearch.com
However, on the intraday RIMM is still trading above its moving averages. The entry I would look for is a failure at the trendline established on Friday, which would be just under 81. Then, a failed test of support at the rising moving average, a correction back up to that moving average, and a failed test at the resistance there. If all these things occur, I'd say that would be the time to enter a short position in RIMM.
If it continues up, and breaks the trend line from Friday, RIMM still might be a good short, but only if it broke support from the intraday moving averages, then failed at least once, preferably twice at a test of resistance there. I would also like to see a crossover and downsloping of all the moving averages (i.e., 50 min, 100 min, and 200 min emas) as these tests occurred.
Comments? Criticisms?
TIA,
Terry |
