Watch Netflix $NFLX

Netflix, like much of the market, has been trading in a narrow, confined range most of this month.  Volatility for the stock is the lowest it's been in years.  As we head into the end of the Month and start of September I am looking to trade $NFLX for a sharp break out of the recent mundane action.

Historically, when volatility is up for $NFLX the stock drops and when volatility dries up, the stock rallies.  They say don't short a dull market, the same could be said for Netflix the last few years.  When the trading gets dull, the stock gets going to the upside.  Which is why I think the stock is setting up for a sharp move back into triple digits.

Below a chart of $NFLX, notice when the going gets dull, the stock gets going....when the going gets dull....  there's a song for that somewhere...

Longer term the price action is coming together for the sharp resolution.


and confirmation of the move will come on a break higher out of recent resistance.

Assuming $NFLX doesn't open a session $5 higher, I'll be waiting for the action to take the price over resistance, and confirm that the breakout back over $100 is coming.

From there, with the assumption the Global Centrally Planned Asset Price Appreciation Scheme remains in fifth gear, with the stock market soaring to fresh record highs, $NFLX could revisit previous highs from the end of last year.

And with option premiums subdued for $NFLX, there has never been a cheaper time the last few years, to trade for upside in the name.

A few trades I am looking at:

$NFLX $97 weekly calls $.45 (expire Friday)

and $NFLX September Monthly $100 strike calls $1.00  (middle of September expiration)

$NFLX Sep Chain

I'll be watching Netflix for confirmation and also for Narcos Season 2.  What a great first season.

Known to most as Uranium Pinto Beans, Jason has more than 15 years under his belt of trading stocks, options and currencies. His expertise primarily lies in chart analysis, and he has a strong eye for undervalued stock. Because he’s got the ability to identify great risk/reward trades he usually enjoys taking the path less traveled and reaping the benefits from the adventure.

He is a co-founder of Option Millionaires, and he is best known for his weekly webinars with Scott, as well as his high level training webinars and charts found in the forums.

More Posts by UPB: View All | Private Twitter Feed: Access Now! (For Diamond Members)

Leave a Reply