Netflix, Inc. (NASDAQ: NFLX)

Netflix, Inc., an Internet television network, engages in the Internet delivery of television (TV) shows and movies on various Internet-connected screens. It operates in three segments: Domestic Streaming, International Streaming, and Domestic DVD.

Take a look at the 1-year chart of Netflix (NASDAQ: NFLX) below with added notations:

1-year chart of Netflix (NASDAQ: NFLX)

NFLX has been in an overall uptrend for the past year. However, the stock has recently stalled, as NFLX has hit the same resistance at $190 (red) on two separate occasions. The stock is currently sitting just under that level now, and a solid close above the $190 should lead to another leg higher for NFLX.

The Tale of the Tape: NFLX has a 52-week resistance at $190. The possible long position on the stock would be on a breakout above that level with a stop placed under it.

Before making any trading decision, decide which side of the trade you believe gives you the highest probability of success. Do you prefer the short side of the market, long side, or do you want to be in the market at all? If you haven’t thought about it, review the overall indices themselves. For example, take a look at the S&P 500. Is it trending higher or lower? Has it recently broken through a key resistance or support level? Making these decisions ahead of time will help you decide which side of the trade you believe gives you the best opportunities.

No matter what your strategy or when you decide to enter, always remember to use protective stops and you’ll be around for the next trade. Capital preservation is always key!

Good luck!

Christian Tharp, CMT