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Netflix Inc (NFLX) - January 25, 2024


*Shares of Netflix are held in portfolios managed by SIA Wealth Management.

SIACharts’ relative strength rankings help investors identify opportunities in stocks which are outperforming their peers or index benchmarks on a relative basis.

Netflix, Inc (NFLX) returned to the Green Favored Zone of the SIA S&P 100 Index Report in October, bouncing back from a brief dip down into the red zone. Since then, the shares have returned 35.0%, while the S&P 100 Index is up 18.7%.

Boosted by better-than-expected sales and subscriber growth, NLFX shares have popped 11.9% in the last week, while the S&P 100 Index is up 3.25% over the same period. After climbing 2 positions yesterday, NFLX is currently in 9th place.

Candlestick Chart Shows a Big Breakout Underway:

Netflix (NLFX) shares staged a major breakout yesterday, blasting through the $500.00 round number barrier on volume. The shares have been under accumulation since the summer of 2022. Last fall, the shares staged a significant selloff and rebound but had worked their way back up toward $480.00, near which they had paused in recent weeks to consolidate their late 2023 bounce.

Yesterday’s rally touched both the top and the bottom of a trading range between $480.00 support and $560.00 resistance with initial support possible near the $500.00 round number. This range previously prevailed through much of 2021 and may be re-emerging. If the shares break out again, next resistance after that may emerge near the $600.00 round number, or $640.00 based on a measured move.

Point and Figure Chart Shows Continuing Accumulation:

Netflix (NFLX) shares have been under accumulation since a big selloff bottomed out in June of 2022. Over the last 18 months, a recovery trend of consistently higher lows has unfolded. Last fall, the shares faced their toughest challenge when two double bottom breakdowns led to a significant pullback, but this was eventually contained by long-term uptrend support.

Since October, accumulation has resumed and the shares have climbed from near $350.00 toward $550.00 without even a 3-box correction along the way, a sign of strong underlying support. The shares have completed bullish Double Top and Spread Double Top breakouts which remain active.

Previous highs suggest next potential resistance may emerge near $587.30 or $701.90 on trend. Initial support appears near $501.25 based on a 3-box reversal, just above the $500.00 round number.

With a bullish SMAX score (which is a near-term 1 to 90-day indicator comparing an asset against different equal-weight asset classes) of 9 out of 10, NFLX is exhibiting short-term strength against the asset classes.

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