Netflix (NASDAQ: NFLX) has been trading in a consolidative manner recently staying between the 467.00 and 497.00 barriers. In the bigger picture, the share is stuck within a sideways range between 467.00 and the all-time high of 575.24 since July 1st. Although it is currently trading near the lower bound of that range, we would take a neutral stance and wait for the exit to occur before we start examining the stock’s forthcoming direction.
If investors allow the stock to drift below 467.00, this would confirm a forthcoming lower low and signal the downside exit out of the range. The near-term outlook will turn negative in our view, and the stock may slide towards the 433.00 level, marked as a support by the low of June 29th. If market participants are not willing to buy near that territory either, then the next stop may be at the psychological mark of 400.00, which provided strong support on April 29th and May 27th.
Shifting attention to our daily oscillators, we see that the RSI lies below 50, but has turned up recently. The MACD, although below both its zero and trigger lines, shows signs of bottoming. Despite both indicators revealing negative momentum, their bottoming signs support our view to wait for a dip below 467.00 before we start examining the bearish case.
On the upside, a rebound back above 497.00 may signal that investors want to keep the stock range-bound for a while more. We could then see advances within the aforementioned range, initially towards the 519.00 barrier, marked by the peak of November 5th, and then towards the peak of September 2nd, at 558.31, or the all-time high at 575.24.
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