NFLX has and still is one of Wallstreet’s darlings and one can wonder how high it can go. To take the guessing out of the game. First lets take a closer look at the bigger picture. We see NFLX now in Major 3 of Primary III. Assuming major 3 will be 1.618x major 1, measured from 2, it should target $136. CLICK CHARTS TO ENLARGE.
We can also see that NFLX formed a bullish ascending triangle over the past few months: similar highs (~$115) and higher lows: sellers step in at the same level, while buyers step in at higher and higher levels. Using this technical pattern we can then establish a target of $140 for a break out above $115. This is inline with the aforementioned Fib-extension target.
Zooming in and using TIs we can observe the following. (Please note that Intelligent Investing only works with observable hard facts and uses the weight of the evidence to then determine the most likely outcome of the market’s or stock’s next move.) Also here we see he 1.618x target and the blue bullish ascending triangle target. Intermediate iv of major 3 bottomed a few weeks ago, we then got 5 waves up to $115.83, followed by 3 waves down. Those were minor 1, and 2. Price is now in minor 3. Clearly it broke out of the $115 top, retested it on Tuesday November 17, and then took off even more. NFLX has now added 20% in 3 days (!). In addition, our A.I. buy/sell indicator on the weekly time frame gave us a buy/long signal 2 weeks ago, and all other TIs are also pointing up. Price is well above it’s 20w, 50w and 200w SMAs: bullish. Lastly, the upper Bollinger band is starting to expand: leading the way one could say.
Based on these observations of hard facts the weight of the evidence tells us to expect more upside. This fast advance is rather typical for a 5th wave. Next resistance is at the intermediate iii ATH: $129. However, based on the technical pattern and Fib-extensions we’re rather certain this level will be broken. Once our target levels are reached Major 4 should take hold and bring price back down to the $100 level, possible even mid-$80s depending on how high Major 3 will go. That would then be again an excellent long opportunity to ride Major 5 of Primary to new ATHs. So yes, NFLX is still not done flying in our humble opinion.