Netflix (NASDAQ:NFLX) has been a market darling for the past two years. It has run up hugely on a cocktail of debt and multiple expansion. The company continues to require debt to fund its content creation in an ever increasing competitive environment (think NYSE:DIS, NASDAQ:AMZN, NASDAQ:AAPL). AAPL reported weak guidance yesterday which I believe marks the end of the FAANG and SPX bull run.
The company has recently broken significantly below its 200 day EMA and backtested the same trend line before closing below. This confirms to me that the market has turned and there is significant downside from here. Short interest is low so a short squeeze is unlikely from here.
There are two gaps open on the daily chart which could act as targets.
Stop loss and profit taking is determine by a closes about the 200EMA.
Fits very well with the back test of the neckline on that same chart or more easily seen on the weekly linear, break and retest, looking for further downside as well. Also in a Phase 7 of a Hyperwave for those that know that system.