RIMM Still looking Good-Pullback?

RIMM long as was covered here last week, the next day after I called it a, "Good looking longer term long position" RIMM reported earnings and was up nearly 20% in after hours. I think RIMM still looks good for a move higher, the question is, "Do we get a chance to pick it up on out terms?". I think the answer to that question is yes and you can see why we don't chase stocks, especially on a move like that in after hours, although it would have been a great place to take a quick 22% gain if you had bought it the day before.

So here's what we see in RIMM and where the opportunity appears to be shaping up.

*Also note that with even decent looking stocks looking like they'll come down a bit, this doesn't bode well for the market or those stocks that are overbought or are just moving out of institutional holdings.

 Resistance here is not as important as the concept of the double bottoms or other bottom price patterns being violated on the downside with top patterns being violated on the upside before they move. Technical Analysis says the first bottom or support area should not only hold, but subsequent pullbacks should fall short of hitting that support area, that is how they justify strength in a stock, but that's the old dogma of Technical Analysis and many things have changed since the days of hand charting. It' a lot more advantageous for institutional money to break support, cause a lot of longs to stop out and be able to pick up those shares in large quantities without anyone knowing what they are doing and at a better price. RIMM is a good case in point with two deeper penetrations of the original support level, watch what happens at each.

 On a 60 min chart the positive divergence becomes stronger at each subsequent break lower, this shows larger accumulation of the position and few longs suspect anything as they gladly give their shares away in the name of discipline.

 This is the most recent break below support on a 15 min chart, note the leading positive divergence which indicates increased activity. Then there's the gap up after earnings, we don't want to chase it so we look for it to hopefully fill a good portion of that gap, with a base this large, it will almost certainly be  worthwhile long position to consider. The 15 min chart shows the profit taking on the day after earnings and I believe we will get a constructive pullback to possibly enter a long in RIMM.

 The 5 min chart today shows some leading lows in 3C that haven't been there, it' not enough to do damage to the big picture, but should be enough to get price down near the gap.

The 1, 2 and this 3 min chart all show intraday distribution as price rises in to the afternoon, this also looks like short term liquidity traders/market makers, etc are getting in position for a pullback.

That's pretty much what we want to see with positive activity in to the pullback and with the longer term charts looking the way they do and as big as the base is, I don't think RIMM has even started it's move to the upside.