NFLX has been super-bullish from quite some time. When SPY visited 348, NFLX was consolidating in a range and didn't go down as expected.
NFLX latest breakout moves have been very violent. As marked, the last breakout gave 22.5% in just 5 days (19.5% in just three days from low of first green candle to high of the 3rd candles)
Now, NFLX has broken out again and we have two long bodied green daily candles. If it is to repeat the last move, we could see 327-330 today and gap fill most probably Monday or Tuesday.
NFLX has formed **two white soldiers** on the daily and another such candle will complete the three white soldiers. In this case, the short and intermediate term is bullish and it might even go higher than 333.9 before retracing. One thing to keep in mind is that there might be consolidation after the three white soliders which is pretty normal.
Overall, NFLX is quite strong and we might see 350s before the next Interest rate decision and CPI reading. However, there might be a pullback after the gap fill.
Other interesting things to note, In the last two moves, NFLX has retraced somewhere between 50-61.8% of the move
So, if we assume that the move will be 23.9%, we could assume a high of 333.9 and with that in mind, the 50-61.8% retracement will bring it somewhere between 298-305 (will most probably dip below 300 and then break out).
Profit taking levels
1. Most of the gapfill (327-329)
2. Full gap fill (333.2)
Be Cautious around 333.2-333.9
You can also play the retrace, however, this time it might make a move higher than 333.9 before retracing.
How to be confident about the retrace
NFLX latest breakout moves have been very violent. As marked, the last breakout gave 22.5% in just 5 days (19.5% in just three days from low of first green candle to high of the 3rd candles)
Now, NFLX has broken out again and we have two long bodied green daily candles. If it is to repeat the last move, we could see 327-330 today and gap fill most probably Monday or Tuesday.
NFLX has formed **two white soldiers** on the daily and another such candle will complete the three white soldiers. In this case, the short and intermediate term is bullish and it might even go higher than 333.9 before retracing. One thing to keep in mind is that there might be consolidation after the three white soliders which is pretty normal.
Overall, NFLX is quite strong and we might see 350s before the next Interest rate decision and CPI reading. However, there might be a pullback after the gap fill.
Other interesting things to note, In the last two moves, NFLX has retraced somewhere between 50-61.8% of the move
- First move was 44.16% from 13 October till 26 October (partially fuelled by earnings), then it retraced around 55% of the move.
- Second move was 23.9% from 7 November to 15 November and the retrace was almost 60% of the move
So, if we assume that the move will be 23.9%, we could assume a high of 333.9 and with that in mind, the 50-61.8% retracement will bring it somewhere between 298-305 (will most probably dip below 300 and then break out).
Profit taking levels
1. Most of the gapfill (327-329)
2. Full gap fill (333.2)
Be Cautious around 333.2-333.9
You can also play the retrace, however, this time it might make a move higher than 333.9 before retracing.
How to be confident about the retrace
- Wait for at least two rejections on the daily with long wicks to the top (last rejection was 3 candles and the one before that was 2) but the long will confirm that buyers are running out of steam (if you want an early entry, you can wait for 3 rejections on the 4h)
- There could be fake retracement so I would wait for it to close below a certain level it broke on the way up.
Comment:
So it did form 3 white soldiers on the daily (even though today the price action could have been better). Gapfill seems possible in the next 2 working days unless there is negative news.
Comment:
Yesterday's daily candle formed a double top on the daily which is concerning. However, it is also an inside candle with NFLX being quite strong (lost the strength later in the day) w.r.t SPY. I think it retests yesterday's highs today (inside candle serving as a continuation pattern.
Yesterday, it bounced from the potential double bottom (310-311 area).
Yesterday, it bounced from the potential double bottom (310-311 area).
Comment:
Supports
310-311, 296-304 (so many wicks there), 278-282
Resistance
318-322, 333-334 (gap fill complete), 356-359
310-311, 296-304 (so many wicks there), 278-282
Resistance
318-322, 333-334 (gap fill complete), 356-359