NFLX (Netflix Inc) remains well below the top of the massive bearish engulfing topping candlestick put in nearly a month ago with the stock limping along the uptrend line generated off the June 25th lows. I realize that most have lost the will to short this market nor do we have any solid sell signals or trend reversals in place in the broad market yet.
However, as with the previous long entry on NLFX just over a year ago, which led to a 60% gain on the trade in under 4 months, technical (as well as fundamental) evidence is rapidly building that NFLX is now in the early stages of a major trend reversal.
NFLX looks to offer an objective short entry on a break below the uptrend line on the daily chart. As the trend in the broad markets remains bullish at this time, more conservative/conventional traders might prefer to wait for a solid close below the daily uptrend line before establishing a short position while more aggressive traders could short any intraday break below the trendline.
