BBRY Stock: Waiting for Fireworks
I can’t even count the number of times I believed that BlackBerry Ltd (NASDAQ:BBRY) stock was finally going to stage a move. I patiently watched with anticipation, and nothing ever seemed to happen. I am starting to believe that BBRY stock is not going anywhere but sideways.
Deep down in my gut, I know if I start to believe that and turn my back on BBRY stock, then that will be the exact moment BBRY stock finally begins to stage the move that I have been anticipating for what feels like an eternity.
The reason I am anticipating a move in BlackBerry stock is that the price has been painting a constructive pattern on the price chart. This pattern has been developing for four years, and one day this pattern will resolve itself. When it does, fireworks are going to ensue.
I have been using prices to analyze potential investments for over a decade, and I have enjoyed some success using this method. The reason why I have found this method to be so successful is that it relies on price and volume data to discern trends and forecast future prices. This data is easy to find, and it is always current; as a result, the price has proven to be the best timing tool.
The following BlackBerry stock chart illustrates the pattern that I am anticipating will one day be completed.
Chart courtesy of StockCharts.com
The BBRY stock chart above illustrates the pattern that has been in development for four years. This pattern is what traders refer to as a symmetrical triangle pattern.
Symmetrical triangles are constructed using two converging trend lines. One trend line represents resistance and the other trend line represents support. These trend lines are defined by connecting the respective peaks and troughs that develop on the price chart.
BBRY stock continues to make higher lows and lower highs as the price continues to bounce off support and resistance. The range between support and resistance continues to get smaller and smaller. As the pattern progresses, momentum is being built and stored.
When the price finally breaks out of this pattern, a sharp move in the price is expected. This is why triangle patterns are particularly powerful and explosive. These traits are a favorite among traders.
The question that remains is: when is this triangle finally going to be completed? And where is this long-awaited BlackBerry stock breakout?
The following BlackBerry stock chart illustrates a bullish intra-day setup pattern that could help shed some light on these questions.
Chart courtesy of StockCharts.com
The price chart above illustrates that BBRY stock has staged quite the rally on the heels of the Donald Trump rally that sent stocks and indices soaring to new all-time highs. This rally caught everybody off guard because the media and pundits had us all believing that the market would crash if Trump won the election. Boy, were they wrong.
The surge in the price created an impulse wave, and then a consolidation wave quickly followed in the form of a pennant. This price action is both healthy and constructive.
At the conclusion of an impulse wave, a condition that traders refer to as “overbought” or “oversold” grips the price and prevents it from moving any further. This condition is measured by using internal indicators and oscillators. When these indicators reach extremes, the price needs to pause or pull back to alleviate the condition. The pause or pullback is referred to as the consolidation wave. This wave also serves to set up the next impulse wave.
As a result, the price action on the BBRY stock chart above is both healthy—as the intra-day overbought condition has been alleviated—and constructive, because the consolidation pattern has just been completed and a new impulse wave is set to develop.
The impulse wave that is set to develop has the potential to test resistance outlined by the symmetrical triangle. So, once again, I am anticipating a possible breakout in BlackBerry stock.
Bottom Line on BBRY Stock
BlackBerry stock is once again setting up to test the symmetrical triangle that has been in development for four years. A successful breakout would have tremendous bullish implications, and a surge in BBRY stock would be expected to follow.