Research in Motion Earnings Trade Ideas
- Posted by Greg Harmon
- on December 20th, 2012
RIMM, $RIMM is building a bull flag under 14.40 resistance, a level that has been important in the past. the RSI has become overbought and the MACD is near a cross to negative. The short term is set up for more consolidation or a pull back. That said the trend is higher and all of the Simple Moving Averages (SMA) are in agreement. A move above that resistance has a measured Move higher to 16 and there is resistance higher at 17.45. Short interest is high at over 20%. Support below comes at 12.10 and 11 followed by 10.25 and 9.65. The reaction to the last 6 earnings reports has been a move of about 15.83% on average or $2.20 making for an expected range of 11.60 to 16.10. The at-the money December Straddles suggest a roughly similar $1.50 move by Expiry with Implied Volatility at 240% above the January at 100%.
Trade Idea 1: Buy the December 14 Straddle for $1.53.
Trade Idea 2: Buy the December 14/16 Call Spread for $0.50.
Trade Idea 3: Buy the December Monthly/December 28 Expiry 16 Call Calendar for $0.18.
Trade Idea 4: Buy the January Monthly 14/17.5 Call Spread for $1.00.
these trade ideas were given to subscribers just before 2:00pm.
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Gregory W. Harmon CMT, CFA, has traded in the Securities markets since 1986. He has held senior positions including Head of Global Trading, Head of Product Development, Head of Strategy and Director of Equity. (More)
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