BlackBerry Shorts Could Get Burned If History Repeats

BlackBerry Limited BB is set to print its first-quarter 2021 earnings later on June 23 and traders may be looking to run the price of its stock up into the event.

The Reddit community, led by WallStreetBets although many are now using the subreddit Superstonk, targeted BlackBerry’s stock in January, along with GameStop Corporation GME and AMC Entertainment Holdings Inc AMC, in an epic short squeeze. The short squeeze caused BlackBerry’s stock to skyrocket 288% over the course of nine days, peaking at $28.77 on Jan. 27 before plummeting 63% over the following four days.

GameStop and AMC have been hot tickers the past few days, in a second short squeeze attempt, and BlackBerry’s recent action makes it appear the stock may be next on the list.

BlackBerry Overtakes GameStop In WallStreetBets Interest; AMC On Top

The BlackBerry Chart: On Friday, BlackBerry smashed into a resistance level at $12.12 after a 21% move on the day and closed under a resistance level at $10.68. BlackBerry’s stock printed an inverted red hammer candlestick on the daily chart indicating a large group of sellers took profits when the stock was unable to pop up over the $12 level. BlackBerry may need a few days of consolidation before another attempt to smash through resistance.

See also: How to Buy BlackBerry (BB) Stock

On May 18, BlackBerry broke up bullish through a descending trendline that has been holding it down since Feb. 8. BlackBerry’s stock retested the downward sloping line as support on May 19 and it held as support. BlackBerry then traded sideways for four days before printing a big green bullish engulfing candlestick on May 26, which signaled the stock was headed higher.

BlackBerry is trading above the eight-day and 21-day exponential moving averages (EMAs), with the eight-day EMA trending above the 21-day EMA which is bullish. BlackBerry is also trading above the 200-day simple moving average, which indicates overall sentiment in the stock is bullish.

Bulls want to see high levels of bullish volume come back into Blackberry’s stock to push it back up over resistance near the $10 level. If it can regain that level as support, it can make another attempt to push through $12.12.

Bears want to see BlackBerry’s sellers continue to push the stock down until it loses support of the eight-day and 21-day EMAs. The eight-day and 21-day EMAs could then act as resistance and push BlackBerry’s stock down until it loses another support level at $8.36.

BB Price Action: BlackBerry’s stock was trading up 5.6% to $10.64 at publication time.