Research In Motion ($RIMM): Strong support at $35


RIMM has break its support at $42.72 and is now poised to head towards the lows in 2008 (around $35).

This is a fairly strong support as it was the lows of 2008 (during the financial crisis). It was tested twice and with it a ‘W’ pattern was formed and it rebounced off the levels.

So, what has changed since then?

1. RIMM is now lagging behind in the smartphone market; playing catchup to Apple’s iPhone (or iOS) and Google’s Android.

2. New competitors includes Nokia (with its partnership with MSFT) and HPQ with its webOS (formerly Palm).

3. Matured and slowing growth for its BlackBerry server.

I expect $35 to be supported first. Whether it will continue to hold will depend on its execution for its Playbook and other new smartphone devices based on the new platform (QNX).

Unfortunately, market demand is not with RIMM on the above. Apple’s iPhone commands a huge following, has a great established ‘App Store’ and the newly iCloud service will continue to lock in users and create demand from the younger generation as well (through music, videos and other digital consumption).


PALM : Ichimoku chart shows potential bearish cross

Palm, having been a darling since they launched Palm Pre is showing a sign that it is either taking a breather and/or taking a dip.

On the Daily Chart, we can see that Tenkan sen is going to cross Kijun sen (BEARISH). For now, we can see that there is a kumo support ahead. And possibly, a last ditch support at 13.37


Fundamentally, we know that there is the Europe launch to look forward to in Q4. Palm SDK has also been released. So, let’s hope the app store will bring good news as well. Of course, there is also the rumour of acquisition.

For now, the company is still burning cash. The wider economy is still weak (in my opinion). All we need is some catalyst to trigger a reversal.

I will be watching this very carefully.