If you're in the trade, I'd stay put and be patient unless you're in options, if you're not in the trade this is a great candidate for a move that is likely beyond the scope of the market cycle, this looks like real interest in RIMM as I pointed out well over a month ago. In terms of the big picture, RIMM could be bought right here and a month down the line the few percent wouldn't make any difference at all, if you are patient (and not very long) I think you can get a better entry.
*Also most of the averages are just hitting negative divergences intraday right now so I'd expect a pullback in the market shortly, RIMM may indeed follow along to some degree.
Remember after the F_O_M_C announced QE3 and I started noticing a trend best demonstrated through APL and RIMM, that trend was the stocks that were beaten up over the last year were the ones looking good and the ones that had been the high flyers were the ones that looked to be in trouble.
Here are the charts....
I'm not going to show you all of the charts from 15 min- 4 hours, this daily chart is in a large leading positive divergence and all of the important longer term charts faster than this are all positive so it would just be very redundant, RIMM looks great on almost every timeframe.
There have been several head fake moves at the yellow arrows, these help with momentum. You may recall this triangle and my opinion that "Normally, we'd expect to see a false move to the downside on such an obvious triangle pattern, but in my opinion we aren't going to see that with this triangle" and we didn't.
Now the only place in the RIMM charts that we even see hints of negative divergences are the intraday to the 5 min timeframe (5 min is where intraday signals stop and institutional ones begin for the most part). We had a smaller negative divergence earlier in the month that led to a little pullback, this one is a bit bigger, I still don't think we'll see anything more than a corrective pullback and that gives us an opportunity to let the trade come to us with a better entry and less risk, allowing you to buy more shares with the same risk as if you had bought here.
Even today as RIMM is trading up over 3%, we are seeing intraday negative divergences, this is likely in the realm of market makers adjusting inventory, perhaps they'll even play the short side (which I would not advise you to do-they have a lot more leverage and a few cents can make them a lot of money-not so for most of us). So I won't go in to the charts between 1 and 5 min, just say that they too show the probability of a near term pullback, but they are still more positive than say the market averages.
On our X-Over Screen we have a confirmed long trade in RIMM. Normally a pullback would be to the yellow moving average which will still move up as price pulls back, in RIMM's case it may not be that deep as the intraday negatives aren't that deep.
Beyond that, for those of you in RIMM, I thought I'd put up some stop ideas for you using my Trend Channel. If you aren't familiar with this indicator, it's my own creation, actually the first indicator I won an award for, a few years later Price Headley created a channel that was nearly exactly the same, but I have proof on Trade-Guild.net that we were using this long before Price started introducing his.
This is not like an envelope channel or Bollinger Bands, it self adjusts to each stock's personality and creates a channel using standard deviations around that average behavior of the stock, when a channel is broken (stop out), we know something in the behavior of the stock has changed dramatically. This was actually influenced by the Turtle Traders for Trend Following.
For a long term trend follower, this channel should hold price action for a year or more in RIMM, of course if RIMM were to brea below the channel on a closing basis, that would be the end of the trend, it's wider at a current stop around $8.10, but leaves plenty of room for consolidations, while at the same time locking in gains nearly every day.
This channel captures about a 3 month or quarterly trend in RIMM and has a tighter stop right now which moves up every day. I prefer to start with a little tighter stops like this or the next and when the stock shows that it can trend, I'll switch over to a longer Trending Channel setting.
Finally this tighter channel captures swing+ moves of about a month long in RIMM, it is obviously tighter, it has less room for a major consolidation, but it's a decent place to start. For options traders you need something tighter than these, just email me for the stop suggestions.
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