Last week RIMM missed their revenue estimates big time, and as a result saw their stock price fall from the mid-80’s down into the 60’s. Today is the first day that it has showed any positive signs – showing strength at and around $66-67. This is a major support level for RIMM, and I have to admit, knowing that this is a Wall Street darling, and the euphoria surrounding this “Never-Say-Sell” market, I have a hard time beleiving that this stock is going to to go down much more at current prices.
I could be wrong, Apple (AAPL) is definitely taking market share away from RIMM, but that is long-term stuff for RIMM and I am only looking at the short-term prospects and the company is still a solid company with excellent growth (just not as good as Apple’s). There are two huge gaps to fill on the chart, and in my opinion, with the crazy bull-run we are on, it would make sense for RIMM to bounce back and fill the gap to the upside and once this market comes back to earth and takes another nose-dive for it to fill the one below its current price level.
The opposite scenerio does not seem very plausible at ths point. Remember too, that gaps don’t necessarily have to be filled, it is just a propensity that the market has, like magnets, to fill any gap that is made in a chart and since trading is a game of probabilities, there’s a high likelihood that these gaps will also be filled at some point in the future.