Preparing for a Breakout Trade in Netflix NFLX

Apr 12, 2016: 11:06 AM CST

Netflix (NFLX) shares are likely about to break free of a compression range, giving us an opportunity to trade the breakout.

What levels are important and what are the extended target on the future breakout?  Let’s take a look:

In the Daily Chart above we’re seeing the price compress (range) between a few pivots:

On the upside we have the upper Bollinger Band, 200 day SMA, and 50% Fibonacci Retracement at $106.50.

For support, we have the rising 20 day EMA (today’s pivot) at $102.00 along with the 61.8% Fibonacci and “Round Number” Reference level at exactly $100.00 per share.

Like the S&P 500, Netflix trades within a short-term range in April.

Shares are likely getting ready for a breakout one way or another from this range.

An upside “short-squeeze” breakout triggers above $107.00 and opens a buy-pathway toward $112.50.

A downside sell/liquidation path opens under $102.50 and especially $100.00 for a swing back to $95.00.

These are short-term parameters (levels) and trades – we’re just looking for the range expansion beyond these boundaries for the next likely swing (and thus trade).

Keep these levels fresh in your notes and trade the departure (breakout) from the range when it occurs.

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Corey Rosenbloom, CMT

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2 Responses to “Preparing for a Breakout Trade in Netflix NFLX”

  1. Netflix Likely to Break Free of Compression Range - Says:

    […] By Corey Rosenbloom […]

  2. Rancho Says:

    Thanks for such a detailed explanation, I really appreciate this blog and your effort, I believe there are not too many sites like this which provides regular updates for free with so much input. I love to follow this blog daily and it’s first thing I open in morning. I work with OctaFX broker where too there is daily analysis available, so I regularly combine that with this and it helps me get an ideal setup for trade while at present in this chart, we can see great opportunity.