JJC:   How on earth did Research In Motion (RIMM) go up 7 points yesterday?... and pull the rest of the Nasdaq up, off of RIMM's pin action, in what otherwise looked like a pretty much down day...

Let me give you a little Wall Street inside baseball... because this is important... knowing how and why stocks move is vital knowledge for anyone who wants to be a good investor... and I'm about to let you in on the picture that you wouldn't know, unless you worked on a great hedge fund trading desk...

To understand the anatomy of this rally, you have to be familiar with a concept we have on the Street... It's called "the Ax"...

Who or what is "the Ax?"...

The Ax is the analyst covering the stock, who has the edge - thus the Ax - over all the other analysts... It's the guy who knows the name better, who has been right on the stock's direction. It's the guy who owns the stock. And a guy by the name of Rob Sanderson, at American Technology Research, is indeed the Ax in RIMM... And Rob Sanderson is the reason for the rally yesterday.

Over the past months, while other tech names have stumbled, Sanderson has been adamant about RIMM... calling RIMM a must-own stock and, so far, this guy has been completely and totally right, which is how you get to be the Ax...

The rest of the Street now bows to his wisdom... and how can you not?...

On a nasty day like today, RIMM hits a 52-week high... It did bounce off... it finished up a dollar and change... But, again, that's the Ax after-effect... the wake of the Ax...

So yesterday, when the Ax put out a note raising his 2009 earnings estimate for RIMM, from $4.25 to $4.60 a share, and raised his price target to $205, that turned heads. Sanderson went up to what's called "Street High"... that's another term you need to know... meaning his earnings-per-share estimate was substantially higher than everyone else's. When the Ax goes up to Street High, that creates a powerful chain reaction of other analysts, looking to see if their numbers are too low... Because he's the Ax, everyone else does take up their estimates, and you get kind of a fantastic virtuous circle up. He's got the edge, and knows the stock better than they do, and that indicates an upside surprise may be coming, and the rest of the Street may be underestimating the power of the underlying business of RIMM.

When the Ax comes out and says - like Sanderson did yesterday - that RIMM is the best way for mobile carriers to grow their average revenues per user... in other words, the best way for the phone companies to make money... and that's called their ARPU - the average revenue per user... because iPhones have been causing bandwidth issues at AT&T (T) and because the Blackberry is comparitively a better ARPU generator for mobile phone companies... people listen.

Sanderson, after talking to multiple money managers, indicated that RIMM is the best growth story in tech... I say hallelujah... and that expectations for August are too low. I say listen to Sanderson...

Sanderson expects upside guidance when RIMM reports in August. But he told us that investors who missed the earlier move are hoping for a pullback.

Too many people expect this one to go down, especially because of the new iPhone launch. The Ax is telling us, don't wait, it ain't going to happen.

When the Ax says he thinks RIMM's August guidance will be better than expected, because of strength at Verizon (VZ*) - RIMM's channel - over AT&T (T)... or because of the acceleration of RIMM's business in Europe, where he expects the 9000 Series Blackberry to start to ramp in the August quarter... and because business with S could be kicking in... What that does is convince investors around that Street that this man, with such credibility, is telling them, listen, don't wait... Get off the sidelines... buy some RIMM.

Historically, raising numbers of a tech stock, above the consensus, by the Ax is a way to jump a stock higher. And Sanderson knows that, even in a bad market... but it is also a great reason to buy...

You put the Ax and the Street High together, and it's like a chemical fire... not a regular fire. The shorts cannot put it out, and it sends the stock higher. That's how RIMM was up $7 yesterday and $1.18 today.

Now, because RIMM is an umbrella name for tech... that means, when it goes up, it generally pulls the rest of the Nasdaq with it. That's what ignited the rally, and that's where the pin action kicked in... 

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