RIMM Update

I don't know whether I want to laugh or be more compassionate for all the people being fleeced right now as RIMM is all over everyone's radar on a CIBC upgrade. RIMM is a stock we have followed with interest for some time and been long sometime, if you want to see how a stock gets moved from stage 1 accumulation to stage 2 mark-up and see short term buyers who are chasing the news get fleeced and knocked out of their new long position for committing the sin of chasing the trade, look no further than RIMM today.

Yes, I like RIMM, it falls under the two different groups of stocks we noticed performing very differently after QE3 was announced, the high flyers started looking really bad or already were and the ones like RIMM who had been beaten up were looking great. I also still like RIMM as one of the few longer term plays that stands on its own feet rather than a market cycle.

The charts...

 This is a 60 min chart, a divergence here is a huge deal, it represents huge underlying activity. Note how RIMM went from confirmation of the downtrend to a huge leading positive divergence from June-September and then based and reversed. The current positive leading divergence bodes well for RIMM moving forward over the longer term and I wouldn't sell RIMM shares, options (calls), probably would have taken profits early this morning or at least partial, but shares, no.

In essence, smart money was in RIMM a long time ago, way before today's upgrade.


 Here's the 5 min chart which appears to be showing smart money selling / shorting in to the move up, which is fine, it's part of an uptrend to have a constructive pullback; it may even open opportunities for us to add to or initiate positions in RIMM.

 The trend of the 3 min chart looks great, I just want to put recent action in perspective, so here's the 3 min trend.

Now here's the 3 min intraday chart, again showing what looks like selling in to today's upgrade news which allows them to pull the stock back, we just watch for accumulation in the faster timeframes to start within a pullback.

RIMM is now red on the day, interesting price action? Actually pretty normal.