Netflix jumped earlier this month after announcing results. It’s now consolidating, and some traders may see potential for more upside.
The first pattern on today’s chart is the bullish gap on October 19 following the quarterly report. Prices cleared a peak of $394.90 from two weeks prior and have remained there since. Has old resistance become new support?
Second, that level is near the 50-day simple moving average (SMA).
Third, NFLX is now trying to form a bullish inside week. That could indicate the stock is digesting its gains and consolidating.
Next you have the falling trendlines along the peaks of July and September. Traders could be watching for a breakout through this resistance.
Short-term indicators may also have gotten more bullish: The 8-day exponential moving average (EMA) is above the 21-day EMA, and MACD is rising.
Last, the fundamental case may have improved because NFLX entered earnings season under a cloud of negativity. It then shocked the bears with strong subscriber growth, making it a potential turnaround story.
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This content is for informational and educational purposes only. This is not a recommendation regarding any investment or investment strategy. Any opinions expressed herein are those of the author and do not represent the views or opinions of TradeStation or any of its affiliates.
Investing involves risks. Past performance, whether actual or indicated by historical tests of strategies, is no guarantee of future performance or success. There is a possibility that you may sustain a loss equal to or greater than your entire investment regardless of which asset class you trade (equities, options, futures, or digital assets); therefore, you should not invest or risk money that you cannot afford to lose. Before trading any asset class, first read the relevant risk disclosure statements on the Important Documents page, found here: www.tradestation.com/important-information.
The first pattern on today’s chart is the bullish gap on October 19 following the quarterly report. Prices cleared a peak of $394.90 from two weeks prior and have remained there since. Has old resistance become new support?
Second, that level is near the 50-day simple moving average (SMA).
Third, NFLX is now trying to form a bullish inside week. That could indicate the stock is digesting its gains and consolidating.
Next you have the falling trendlines along the peaks of July and September. Traders could be watching for a breakout through this resistance.
Short-term indicators may also have gotten more bullish: The 8-day exponential moving average (EMA) is above the 21-day EMA, and MACD is rising.
Last, the fundamental case may have improved because NFLX entered earnings season under a cloud of negativity. It then shocked the bears with strong subscriber growth, making it a potential turnaround story.
TradeStation has, for decades, advanced the trading industry, providing access to stocks, options, futures and cryptocurrencies. See our Overview for more.
Important Information
TradeStation Securities, Inc., TradeStation Crypto, Inc., and TradeStation Technologies, Inc. are each wholly owned subsidiaries of TradeStation Group, Inc., all operating, and providing products and services, under the TradeStation brand and trademark. TradeStation Crypto, Inc. offers to self-directed investors and traders cryptocurrency brokerage services. It is neither licensed with the SEC or the CFTC nor is it a Member of NFA. When applying for, or purchasing, accounts, subscriptions, products, and services, it is important that you know which company you will be dealing with. Please click here for further important information explaining what this means.
This content is for informational and educational purposes only. This is not a recommendation regarding any investment or investment strategy. Any opinions expressed herein are those of the author and do not represent the views or opinions of TradeStation or any of its affiliates.
Investing involves risks. Past performance, whether actual or indicated by historical tests of strategies, is no guarantee of future performance or success. There is a possibility that you may sustain a loss equal to or greater than your entire investment regardless of which asset class you trade (equities, options, futures, or digital assets); therefore, you should not invest or risk money that you cannot afford to lose. Before trading any asset class, first read the relevant risk disclosure statements on the Important Documents page, found here: www.tradestation.com/important-information.
