RIMM Update

RIMM is one of the few long positions that I like, that I think can stand on its own feet without needing to draft the market. There are only a handful of these stocks and as I suspected way back when and as has developed since the announcement of QE3 (and I'm pretty sure I know why we are seeing this-but that's a longer story) it has been the high fliers getting knocked around and the beaten up stocks seeing money sniffing around. Here's a hint, if you were a fund manager would you rather the F_E_D told you straight out, "We will maintain ZIRP rates until June of 2015" or would you prefer, "We want to tie our quantitative easing and open market purchases to the incoming economic data and adjust as needed"?

I think most would go for the first because it is certainty, lacking certainty as the F_E_D discusses this new yard-stick for policy, I think many managers feel more comfortable in stocks that are around a 10 P/E on average rather than a 15 or 20 in case the F_E_D all of the sudden changes policy on a Non-Farm Payrolls report.

OK, why do we like RIMM?

 The change in 3C's character on a daily chart is pretty self-explanatory as to why we like RIMM, major shift in sentiment toward RIMM and they are putting their money where their mouths (well they probably aren't talking too much about it yet).

 The 60 min chart in RIMM is fine, it's in confirmation of the trend so no trouble there.

 A 30 min chart is about as far out as we can go to see a hint of a negative divergence in RIMM, this is along the lines of the overall market so again it's not a problem, more like an opportunity.

 A 15 min chart makes the divergence clear, but it's small, it's just enough to send RIMM in to a pullback, it's not serious distribution like we were seeing in AAPL where funds REALLY wanted out.

 We want to buy RIMM in to a pullback, let it come to us, but we want to see accumulation of the pullback to know when its time, we aren't there yet.


 The Clear method shows RIMM with two reversal candles, both on rising volume, that was your cue that a near term reversal was coming, the clear method so far on the daily also shows there's nothing standing in the way of ore downside in a pullback. If you didn't get in when we were watching the base (you'd be at a 50-75% profit right now) then the next best thing is on a pullback at lower prices/less risk.

As for stops, I'm inclined to give 3C a strong voice in any potential stop, but just using the Trend Channel, the tighter is at $9.60 and the wider is at $9. Again though, I'd look at 3C before deciding whether to stop out and I'd use the wider channel, in fact I'd prefer $8.85 on a pullback.

Patience, this will come to you.