Why BlackBerry Stock Looks Revved Up For Q1 Earnings

BlackBerry Ltd BB is set to print its first-quarter 2022 earnings after the bell on Thursday.

When the Canadian intelligent security and software company reported its fourth-quarter 2021 earnings on March 30, its stock closed down almost 10% the following day.

For the fourth quarter, Blackberry reported revenue of $215 million, missing the analyst estimate of $245.1 million, and earnings per share of 3 cents, down 66.67% from the same period the year prior.

BlackBerry’s stock is trading over 50% higher than when it released its last earnings report at around $13. The stock has seen renewed interest from retail traders and has been trending in Reddit communities over the past few weeks.

Institutions are showing interest as well and have been hammering call option contracts on BlackBerry with strikes as high as $42.

The BlackBerry Chart: BlackBerry’s stock has been consolidating since reaching a high of $20.17 on June 3. Since then, above-average volume on the daily chart has caused BlackBerry’s stock to become volatile and the stock has moved over 6% in each of the last three trading days. In its consolidation, BlackBerry has formed into a bullish falling wedge pattern. On Friday, the stock tried to break up bullish from the pattern but failed.

BlackBerry’s stock is also holding support within the wedge at the $12.89 level and has not closed below the level since June 1. Although BlackBerry could continue trading down further into the wedge before breaking up from it, the heavy support in this area may mark the trigger point for the break.

Blackberry is trading below the eight-day exponential moving average (EMA) and above the 21-day EMA with the eight-day EMA is acting as resistance and the 21-day EMA acting as support. This indicates there is indecision on the stock in the short-term. BlackBerry is trading about 50% above the 200-day simple moving average, which indicates overall sentiment in the stock is bullish.

See Also: AMC, Clean Energy Fuels, BlackBerry Continue To See High WallStreetBets Interest; Corsair, Petco See Drop

Bulls want to see BlackBerry’s stock break up bullishly from the wedge with strong bullish volume and for it to continue a move up over resistance at the $14.28 mark. If BlackBerry’s stock can clear that level, it has room to move up toward $15.63.

Bears want to see BlackBerry trading down into the wedge until losing the strong support just below the $13 level. This would also cause BlackBerry’s stock to lose support of the 21-day EMA which could cause BlackBerry to fall down toward $11.72.

BB Price Action: BlackBerry was trading down 4.42% at $12.33 at last check Monday. 

Photo courtesy of BlackBerry.