The BlackBerry stock price recovered late last week to pare earlier losses. Furthermore, BB may be showing some encouraging signs of life.
BlackBerry (NYSE: BB) gained $0.24 (+2.08%) on Friday to round the week off at $11.79.
Ontario-based legacy handset maker BlackBerry has been one of the old-school favourites to re-emerge in 2021. We all know that BB stock caught the eye of the Wallstreetbets crowd earlier this year, along with GameStop, AMC Entertainment, and Clover Health.
In January, the hype surrounding Blackberry’s pivot towards the nascent EV sector got the price as high as $28.77. However, recent bullish runs have fallen short of the mark. In June, BB enjoyed a second-coming in 2021, rallying 130% in 5 days from $8.70 to just 0ver $20.00. Although that also proved to be short-lived, and subsequently, the price has been steadily declining in the five weeks, following the June 3rd peak.
However, after breaking down through the 50-day moving average at $11.23 on Thursday, BB recovered intraday and settled above the threshold. Moreover, Friday’s positive price action lifted Blackberry further above the important indicator. Moreover, BlackBerry is now testing the resistance of its recent downtrend.
The daily chart highlights three distinct trend lines that have provided direction for the price. The first is an uptrend from November 2020, which is currently visible below the market at $8.73. This should be considered the longer-term uptrend and a significant support level.
Secondly, two descending trendlines from June provide short-term support and resistance levels, straddling the price.
Thursday’s decline was reversed at the lower trend line at $10.86. Furthermore, Friday’s rally fell just short of penetrating the higher trend line at $11.80. The high of the day was $11.79, so on that basis, the trend should be considered important.
The major moving averages are supportive and all below the current price. Furthermore, the bounce from the 50-day on Thursday indicates the price is respecting this indicator. As long as BB remains above the 50 DMA and the lower of the two descending trendlines, it has a chance to recover. Additionally, if BlackBerry closes above the trend at $11.80, it may extend higher to the 3rd of June’s $13.57 low.
However, a break below the 50 DMA and the trend (now at $10.76) targets the 100 DMA at $10.54. Following that, the next significant support is not seen until the 200 DMA at $9.11, which sits just above the long term trend line.
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