NFLX remains above a long-term uptrend, but the latest earnings reaction has it down 36% for the week (so far).
The extension below the 30-week SMA is noteworthy. Only in two prior instances has the extension below the moving average been this great:
Late 2004
Late 2011
There is still room to drop further to test the demand line, with about another 25% needed to tag the $160 level. Not saying it happens, but always a possibility the market decides to test it.
There is also some room to drop further on the extension below the 30-week SMA. I am mainly using the 2011 pullback as a go-by for that analysis.
These massive pullbacks bring in volatility and headlines, fear & greed. Emotions are heightened. Tweets galore. Here’s Elon’s take:
As a technical trader, I don’t care about the headlines or opinions. I care about the tape’s reaction.
Right now, I don’t want to play this name unless there’s a tag on that demand line or the volatility settles down, and the PnF chart signals a buy. I’ll let others get chopped up and whipsawed in this environment; that’s not my game.
Best,
Trace