BBRY Blackberry – Cloud Based Internet Of Things IoT Software Platform

by Olivier on January 10, 2015

If the Internet of Things ‘IoT’ is the next big thing, then BBRY – Blackberry with its recent launch of a cloud-based IoT platform has the potential to become a red hot stock. I bought an initial position as you can see here:

Here’s a quick overview of various reasons why I am getting more and more interested in the IoT story and its potential:

Ultimately it is going to be about a company’s ability to gather all the information the connected ‘things’ will send out and make sense of all that info. Here’s were the software side of things comes into play. The last thing you want is your data to be stolen or compromised. Here’s where security comes into play. BBRY – Blackberry offers a solution for both needs.

BBRY has a a lot of cash, a rather low valuation and the latest earnings suggest the company is well on its way to turn around. The new CEO John Chen is famous for taking over struggling companies and being very successful at implementing the necessary changes. Ultimately opinions do not matter. Only the stock price will tell the story. On to the charts:

Click on weekly BBRY chart to enlarge:

As you can see in my chart annotations, volume is contracting. As the slope of the weekly moving average 30 is rising, this suggests odds for a break to the upside are higher. Hence an initial position makes sense. It is worth holding that position as long as BBRY trades above that MA 30. The true move will start once BBRY can clear the 11.20 price level. A stop buy order above that level is an easy and very straightforward way to increase exposure. I will aggressively add to my position if the stock proves it can move higher. Overall the weekly chart is displaying extreme pattern pressure that will soon be resolved. Let’s see if it is to the upside. As the IoT story is gaining traction BBRY might very well be the next stock traders pile into.

Click on daily BBRY chart to enlarge:

The daily chart shows price hitting multiple moving average support. Although the technical set-up is not ideal, for aggressive traders an initial position makes sense. The most recent run-up starting from below the MA 200 on increased volume is what I would label a thrusting move. The recent pullback is rather orderly and showing low volatility. But the true move will only start once the stock can clear the 11.20 level. It might prove to be an explosive move, but as of yet it is too early to tell. Placing stop buy orders to increase one’s position if the stock proves itself is the way to go. That way you eliminate emotions from the decision making process. Another thing that makes me bullish are the recent volume spikes whenever the stock goes higher. I view this as stealth accumulation.

The IoT has huge potential. There is no doubt about it. That’s why I tweeted the following:

Updated 01/12/15: 

Stock list of ‘IoT’ Internet of Things and ‘M2M’ Machine to Machine plays:

SWIR – Sierra Wireless, BBRY – Blackberry (former RIMM – Research In Motion), CAMP – Calamp, UBNT – Ubiquiti Networks, LOGM – Logmein, FSL – Freescale Semiconductor Holdings, NMRX – Numerex, ORBC – Orbcomm, FLTX – Fleetmatix Group, ITRN – Ituran Location & Control, ZBRA – Zebra Technologies, ESYS – Elecsys, BOSC – Better Online Solutions, MIFI (former NVTL) – Novatel Wireless, SIGM – Sigma Designs, CTRL – Control4 Corporation, LOJN – LoJack

Related Posts – Emerging high potential IoT leaders to keep a close eye on:

Let’s see how things evolve. No matter what, never fall in love with a stock and heed the following advice:

The alternative to managing risk is not managing risk, and that never turns out well. – Mark Minervini


Investing in your education always pays. Learn how to read chart patterns like a pro! Tischendorf Letter Premium:

Previous post:

Next post: