Blackberry Stock Price Could Soon Bounce Back

Summary:

In this Blackberry stock price analysis, we explain why the stock could soon bounce back according to a chart pattern on the hourly chart

The Blackberry stock price has struggled recently as its interest among retail traders has waned after its earnings. The stock ended the day at $12.24, which is about 40% below the highest point this month. This brings its total market capitalization to more than $6.8 billion.

Blackberry news. Blackberry published relatively mixed earnings last week. The firm’s revenue decline by 18.69% year-on-year to $174 million while its earnings-per-share declined to -$0.05. The biggest disappointment was that its cybersecurity business continued to disappoint. Its cybersecurity revenue came in at $107 million, lower than what analysts were expecting. Its gross margin came in at 57% while its retention rate was 94%.

The Blackberry stock has also declined after several Wall Street banks downgraded the stock. Analysts at CIBC downgraded the stock from neutral to underperform. Similarly, analysts at TD Securities lowered their forecast from hold to reduce while those at Cannacord Genuity talked about its valuation. Still, there are some catalysts now that the firm is considering selling some of its intellectual property portfolios. An analyst said:

“Should management reach a deal to sell the licensing business, we believe this could help unlock value and provide a capital infusion to drive accelerated software and services growth.”

Blackberry stock price analysis

The hourly chart shows that the BB stock price has been in a tight range recently. The stock has been moving in a relatively bearish trend. At the same time, it has managed to move below the 25-day and 15-day exponential moving averages (EMA). It is also along the upper side of the descending channel that is shown in black while the two lines of the MACD have formed a bearish crossover.

Therefore, since this channel has a close resemblance to a falling wedge, there is a possibility that the stock will bounce back soon. For this to happen, bulls will need to move above the upper side of the channel. The alternative scenario is where the shares drop and retest the lower side of the channel.