Research in Motion (RIMM) maker of the infamous Blackberry smartphones was crucified this week as investors and traders publicly crucified the stock price with no mercy. The stock dropped a whopping 21% in one day’s of trading. Since Mar 24th 2011, the stock has lost 57% of it’s value. I would say this is the first casualty of the smartphone war which Apple has started 3 years ago. Ever since the iphone was first released in 2007, Blackberry seemed to blow off that Apple would pose a threat to Blackberries market share. A war was started in the smartphone industry and Blackberry seemed to have a little too much confidence in loyalty of their customers. By the time Blackberry released their first touch interface phone, it was too late.
I would not start shorting RIMM at the point, as it has reached a selling climax. The selling climax is signaled by a 600% increase in volume from the average. The question now, is whether RIMM is a viable buyout opportunity, this I could not tell you. Buyouts are a whole different game in trading.
