The daily chart of BlackBerry (BB) is a good example of positive technical price action. Shares are currently consolidating under resistance in the $12.60 area, which is being reinforced by the 50 day moving average. But all indications are the stock will break above this resistance and continue higher.
Let’s take a look at the chart.
BlackBerry shares began moving higher after breaking above a multi-year downtrend line in early 2017. They made a series of higher lows under resistance in the $11.70 area. This price action created a large rising triangle pattern on the chart.
At the beginning of this year, BlackBerry shares gapped above the triangle’s horizontal resistance level and rallied up to a $14.50 high.
A small two-day double top formed there and shares began pulling back. The January decline that followed took price back down to fill the previous upside gap, in the process retesting the triangle resistance-turned-support line.
The stock is now consolidating above the $11.70 triangle resistance level and below the $12.60 and the 50 day moving average.
Moving average convergence/divergence reflects the recent upside momentum this month, and is attempting to cross above its center line. Chaikin money flow has turned positive but overall volume is still weak.
A successful retest of a former long-term resistance level, like the triangle trend line, is considered very bullish. An upper candle close above the $12.60 level would confirm the triangle breakout retest and re-establish BlackBerry’s longer term uptrend.