Netflix Out of Compelling Storylines for Now

After spending much of the late-winter, spring, and summer essentially grinding sideways in a massive range we now have Netflix gapping down massively this morning after earnings. From a broad market perspective it is impressive for bulls to see the Nasdaq hang tough and, thus far, avoid significant pin action or sympathy selling from the NFLX dump. 

But as far as Netflix is concerned, when a sizable and obvious range breaks decisively it is something which should typically be taken very seriously. 

On the zoomed-out NFLX daily chart, updated below, we can see as much. This type of development should likely have us putting NFLX in the proverbial swing trading penalty box until we see signs that buyers are feeling compelled to swoop in for value, a process which can take anywhere from three days to a few weeks.

And, of course, there is the possibility that NFLX may be tapped out in terms of the type of growth the market expects from liquid tech leaders. In that case, we would want to avoid NFLX for a good while. 

In the meantime, we have some impressive charts and outperformers in the healthcare space (XLV ETF) this morning, a few of which we are playing and noting with Members.