BlackBerry Bulls And Bears Battle Over Break Out: A Technical Analysis

BlackBerry Ltd BB has been a popular stock lately as it continues to trend in a number of Reddit communities and institutions hammer call contracts day in and day out.

On Wednesday, options traders purchased $801,706 worth of call contracts and most had an expiry date in July. This indicates these traders believe BlackBerry will make a bullish break in the near term.

On Thursday, options traders continued to purchase bullish call contracts in BlackBerry but with a much further out expiry date: At 12:16 p.m. two identical orders were placed with a strike price of $30 and an expiry of Jan. 20, 2023. Together the orders totaled $210,000. 

On Friday, morning options traders continued to sweep call contracts and one trader purchased $65,340 worth of calls with a strike price of $12 expiring July 30.

See Also: How to Buy BlackBerry Stock Right Now

The BlackBerry Chart: BlackBerry’s stock has been trading in a bullish falling channel since June 8 and on Friday morning attempted to make a break above the top sloping trendline of the channel but was immediately sold off. The stock then dropped back into the channel but held above support at $11.72.

BlackBerry has been battling with the resistance of the eight-day and 21-day exponential moving averages (EMAs) and Friday’s action caused the eight-day EMA to cross below the 21-day EMA which indicates bearish short-term sentiment. BlackBerry is also trading below the 200-day simple moving average which indicates overall sentiment in the stock is bearish.

Declining volume on the daily chart indicates a large move could be imminent. Whether the move finally breaks BlackBerry’s stock up from the pattern or pushes it further down will depend if the bulls or the bears take the reins of control.

BlackBerry has support at $11.72 and $10.68. It has resistance above at $12.89 and $14.28, as well as at the eight-day and 21-day EMAs.

BB Price Action: Shares of BlackBerry were trading down 1.40% at $12 Friday at publication.