Although the Netflix stock (NASDAQ: NFLX) took a dive together with the rest of the market, the price has recently rebounded and made its way higher. The current situation with the coronavirus and the “stay at home” policy in most countries, is helping the company find demand in its service globally. However, will this outweigh the overall risk-off environment in the market? From the technical side, we can see that the stock had changed its trend from an upside to a downside one, when the price fell below the medium-term upwards-moving trendline taken from the low of September 24th, 2019. Even if NFLX pushes a bit higher, as long as it stays below that upside line, there might be more downward pressure to come in the near future.
As mentioned above, a small push higher could test the aforementioned upside line from underneath once again, but if a daily candle fails to close above it, this may lead to possible reversal back down. If so, NFLX might drift to the 316.52 obstacle, or even to the 301.86 zone, marked by the low of March 18th. If there are still no new buyers in sight, a further decline could bring the price to the current low of March, at 290.00.
Looking at our oscillators, the RSI and MACD, both started climbing up a bit. However, the RSI is still below 50 and the MACD is below zero and its trigger line. This setup with the indicators somewhat supports the above-mentioned scenario, at least for now.
Alternatively, if the price accelerates and makes its way above the previously-discussed upside line and also above yesterday’s high, at 348.28, this would confirm a forthcoming higher high and more buyers may join in. The stock could then travel to the 364.38 obstacle, a break of which may set the stage for a move to the 383.78 level, marked by the high of March 4th.
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