The Netflix, Set-Up

Another ‘Implosion’, Waiting To Happen

Get woke, go broke, right?

Corporations control the ‘woke’ part.

What can’t be controlled is when the ‘broke’ part shows up.

We can, however, discern a potential inflection point … or, points.

In the case of Netflix (NFLX), that inflection appears to be happening now (not advice, not a recommendation).

Netflix NFLX, Weekly

Two weekly charts are shown.

The first has the terminating wedge, tentatively confirmed with last week’s new weekly low (below NFLX: 348.71).

The second chart shows the Fibonacci retrace to the 38.2% level; if there’s a reversal and the level holds, it indicates weakness and higher probability for continued downside action.

Note how the wide, high-volume bar of week ending 4/22/22, has been completely retraced.

This is what markets do; they tend to come back and test wide, high-volume areas.

In the case of NFLX, that test required about 40-weeks to accomplish.

Summary & Strategy

Price action itself will define the potential strategy (not advice, not a recommendation).

Based on where the overall markets closed on Friday, the expectation is for more downside action at the next open, then followed by a retrace that day, or the next.

If it happens, we’ll look at NFLX, on the daily chart for additional set-up clues.

Stay Tuned

Charts by StockCharts

Note:  Posts on this site are for education purposes only.  They provide one firm’s insight on the markets.  Not investment advice.  See additional disclaimer here.

The Danger Point®, trade mark: No. 6,505,279

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