Netflix (NFLX) reported its quarterly earnings with strong subscriber numbers, which was posted after the US markets closed. Because it reported strong than expected subscriber growth of 370k in the US and 3.2mil internationally the stock is up close to 20% at $199.25 in pre-market trading at the time of writing this.
Can The Bull Run Restart For Netflix?
Today we take a closer look at Netflix after it reported strong earnings and subscriber growth, propelling the stock (in pre-market) within its all time high prices around the $130 mark.
Since 2012 Netflix has enjoyed a spectacular run in price climbing from around $7.50 - 8.00 level back in 2012, all the way up to $130.93 closing high price last December. In a short 3+ year period Netflix has climbed over 1500%.
After the huge run in price the up trend ended and the price fell back to around the $85 level on 3 occasions marked with the 3 black circles on the support line. (See chart below)
The pre - market trading price is shown with the horizontal line inside the circle, to give you an indication on where its likely to trade when the market reopens based on the price at that the time of writing.
Since the price has confirmed the break out of the mini downtrend and is now approaching the resistance level of $129.25 it has a good chance to break out to new record highs and restart its bullish uptrend that ended last December.
Viewing the Netflix chart on a shorter time frame with a daily chart, we can see that the price had been struggling to break out of the range in price. In fact the range of prices was being squeezed as the market tried to determine the new direction. (See chart below)
On a daily chart the next level of resistance is around the $111.50 as noted in the chart. However based on the pre - market price it looks to open comfortable above resistance. This puts it in contention to reach the next level of resistance of $129.25.
If Netflix can close on a daily chart above resistance level of $129.25 and hold above it for the weekly close as well, than Netflix can recommence its uptrend to new record highs.
Disclaimer: This post was for educational purposes only, and all the information contained within this post is not to be considered as advice or a recommendation of any kind. If you require advice or assistance please seek a licensed professional who can provide these services.
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I am a private trader and equities investor that loves the trading and investing world, following the markets and everything in between.