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$RIMM : Rally has failed. Price below kumo

RIMM counter rally has fail. It never make it to break out of the kumo resistance.

With yesterday’s earnings, RIMM has gap down. And on the Ichimoku chart, we have a very strong confirmation of a bearish move. The price is below the kumo now confirming that the bear trend is back.

We can also see that the Tenkan sen and Kijun sen has crossed downwards.

With Apple iPhone 5 expected to launch in October, RIMM will find it hard to catch up in terms of units sold for its BlackBerry. Other challenges includes Apple consolidating its position in tablet sales and most likely with a new tablet in the coming months.

But, what really worries me is Q1 2012 report from RIMM. In the report, RIMM used ‘shipped’ .

I recall Palm faces the same problem a few years back when the webOS was just unveiled. They too used the term ‘shipped’. Does ‘shipped’ equal ‘sales’?

If it does not equate to ‘sales’, then inventories and write-offs are going to come back and haunt them.

Note:

Bearish. Vested with PUTS.

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Tech

Research In Motion Ltd ($RIMM) : Break long term support and more to go..

 

RIMM announces on Thursday after trading hours that it was missing revenue target and analyst estimates.

With that news, price breaks the support at $35 with a gap down that goes below $30 convincingly with a show of high volume.

From the Ichimoku chart, we can see that $35 is the lows for RIMM way back during the financial crisis. Now, that the price is trading below $30, it is a strong suggestion that the challenges for RIMM is even greater when compared to 2008.

Among the most important indicator for RIMM will be its shipment and sales for Playbook. Despite RIMM downplay on the importance of it, there is no denial that the tablet market is where the growth is.

Competitors includes Apple (AAPL) with the iPad2 and Google with Android. And we also need to watch out for Hewlette-Packard with the WebOS and they are expected to launch some new tablets products this July (only about 2 weeks from now). Lenovo has also come out with their vision and version of the tablets.

There is no doubt, the success of the tablets will be a great indication of whether RIMM is able to transform itself.

From the trading chart point of view, we only need to reference Nokia (NOK) and Palm’s charts to see a similar pattern. RIMM is going through what Palm went through a few years back.

Remember the story of number of units shipped? Yes, likewise analysts will be trying to find ways to check if the number of units shipped translate to actual sales.

The difference between companies like HPQ and Lenovo will be the channels. HPQ and Lenovo have a strong sales channel both within the entreprise market and the retail. However, for RIMM, this is definitely lacking. And it will take lots of time to build up this channel; a luxury that RIMM will not have.

My believe, RIMM is poised to go down even more. My guess. Below $20 by Dec 2011.

Note:

1. This is not a time to bottom picked. It can goes lower.

2. If it turns around, we should see consolidation on the chart first.

3. I am vested with a bearish bias.

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Tech

Nokia (NOK) : Consolidation amidst bad news…

Despite bad news of Sony Ericsson (and now Samsung) ditching Symbian, Nokia share price isn’t going down much.


From the chart, we can see some consoldation and range bound trading for NOK.

Seems like this is a consolidation period with the market giving the new CEO some breather during his ‘honeymoon’ period.

One of the speculation is Nokia will embrace multi-OS approach in the form of licensing Microsoft Phone OS.

It is hard to comment if that approach will revive Nokia (or even act as a stop-gap measure to attract consumers).

But, I do remember that when Palm license Microsoft OS, it wasn’t that great a company until the WebOS was shown.

Thinking out loud. Won’t licensing another OS eats into the margins?