Coming into today Research in Motion(RIMM) was on my radar. Some news had come out in the pre-market about the pricing of its tablet computer. The news basically said that the tablet would be priced below $500 which would make it a cheaper alternative to the iPad. The pre-market wasn’t showing much in the way of price action but I had RIMM on my watch list to see how it would react to this news.
Immediately on the open RIMM showed some strength, basically trending higher for a $1.50. The first level I was watching as potential resistance was 56.60 which was the highs from 11/08. We broke this level in the first 15 minutes but this was where your skills as a trader must come in. First of all the stock had just run for over a point so odds are pullback or sideways consolidation was to be expected. Second the open in this market lately has been a chop zone with a lot of volatile sideways action. For about 2 months now, in our morning meetings at Keystone, we have talked about the better opportunities presenting themselves after the open around 10-10:30am.
After the open I knew I wanted to get involved in RIMM. The market was showing weakness especially in the tech sector and RIMM was staying relatively strong. It was only a matter of waiting for RIMM to consolidate and finding a good area to manage risk. I entered during the hour-long consolidation pattern and added on to the trade when it broke the high of 56.81.
As you can see for the rest of the day it was just a matter of how much you made on this trade. Personally I missed about .70 in middle of this trade because I covered the entire position around the resistance at 58.00 instead of holding a piece. I got back in on the next break out but left some money on the table. Coming into tomorrow I am expecting RIMM to still be in play as this is usually a stock that trends for a few days after a news related break out. The 200ma is at 59.50 but above that could see a trend into the 61-63 area. Best of luck in your trading and have a great night.
Kyle
Tagged: day trader, day trading stocks, equity prop firm, intra day trading, online stock trading 
