Netflix, Inc. (NFLX) Technical Analysis

Price Action Analysis

Overview:

The price action on the daily chart shows a persistent downtrend with lower highs and lower lows over the past several months. The latest price activity sits in a tight, crowded area near the late-2024/early-2025 support region.
On the weekly chart, the long-term trend remains down, with occasional pullbacks that failed to establish a sustained reversal. The current price level sits well above the least favorable long-term levels but still well below prior swing highs, indicating ongoing bearish pressure.

Step-by-step observations:

Daily regime:
- Trend direction: Clear downtrend with intermittent short-lived intraday bounces that fail to sustain.
- Breakouts: No meaningful bullish breakout recently; recent action tests minor resistance around the mid-80s but closes back near the recent lows.
- Candlestick structures: Multiple elongated red candles with occasional small green candles, suggesting ongoing distribution and selling pressure in recent sessions.
- Notable levels: The latest action tests a critical near-term support around the mid-70s (roughly $75–$76). A daily low near ~$75.2 was registered, indicating the area as a key anchor.
Weekly regime:
- Trend direction: Downward trajectory remains intact with lower highs attempts that did not produce a durable reversal.
- Volume behavior: Weekly volume tends to spike on downside moves, signaling participation in the selling. Upweeks show less commitment than down weeks, reinforcing the bearish bias.

Interpretation:

The confluence of a sustained downtrend, price trading near a historically important support area, and persistent downside-volume participation points to a bearish to cautious stance in the near term, with potential for a volatility-driven bounce if selling pressure eases and buyers step in around key support.

Technical Indicators

Key Readings (current context derived from recent data)

Indicator	Current Reading	Implication
50-day Moving Average	~$111.80	Price is well below the 50-day MA, signaling a near-term bearish momentum and a continuation risk unless a reversal occurs above this level.
200-day Moving Average	~$111.80	Price is far below the 200-day MA, reinforcing a longer-term bearish context and lack of sustained upside leverage.
RSI (14)	~19.7	Deeply oversold territory, which can precede a near-term relief rally or short-term countertrend, but not a guaranteed reversal without accompanying bullish signals.
MACD (fast 12 / slow 26 / signal 9)	MACD ≈ -3.3; Signal ≈ -3.2; Histogram ≈ -0.1	Negative momentum predominates, with a marginally negative MACD line; watch for a potential cross or a widening histogram as a sign of continued downside or a waning bearish pace.

Notes:

The price remains far below major Moving Averages (50-day and 200-day), indicating that the prevailing tone is bearish.
The RSI being deeply oversold opens a window for a potential short-term bounce, but confirmation typically requires a momentum shift (e.g., MACD turning bullish, price reclaiming key levels, or a sustained uptick in volume on rallies).

Volume & Momentum Analysis

Volume on down days has shown several spikes, indicating active participation in the selling phase. This supports the notion of distribution during the leg down rather than a quiet fade.
There are occasional upticks on small rallies, but these are not accompanied by broad, sustained volume increases, suggesting the rallies lack conviction.
The combination of heavy downside volume and a deeply oversold RSI creates a setup where a relief bounce is plausible in the near term, but a durable reversal would require a shift in both price action (sustained higher highs) and volume (increased buying pressure).

Key Buy/Sell Levels

Current price: NFLX around $75.86

Trendlines drawn (conceptual, for planning only):

Support line: around $75.5 (extends from mid-February through mid-May 2026)
Near-term resistance line: around $82.2 (extends from mid-February through mid-May 2026)

Buy-level zones:

Primary near-term support zone (buy upon reaction if price holds): around $75.0–$76.0
- Has this zone been touched? Yes. The price recently traded as low as approximately $75.2, indicating the area is active support.
- If not actively tested, distance from current price: already touched (current price ~ $75.86 close to the zone). If seeking a more cautious entry point, wait for a daily close above the W-pattern or a bullish candlestick reversal near this zone.
- Rationale: This is the immediate support cluster where previously observed selling pressure abated, and oversold conditions (RSI) could prompt a short-term bounce.
Secondary buy zone (confluence around a potential short-term reversal area): around $80.0–$82.0
- Has this zone been touched? Not in recent immediate action; the last reported intraday highs are in the low to mid-$80s.
- Distance from current price: ~+$4.14 to $82.00 and ~+$6.14 to $84.00; about +5.5% to +8.3% from current price ($75.86).
- Rationale: Reclaiming this zone could signal a pause in the down move and provide a better risk/reward for a longer entry if accompanied by bullish price action and rising volume.
Tertiary upside zone (for reassessment if price breaks higher): around $90.0–$92.0
- Has this zone been touched? No, not in the current pullback context.
- Distance from current price: ~$14.14–$16.14; about +18% to +21%.
- Rationale: A move through the near-term resistance could bring into play the mid- to long-term negative-to-neutral transition, especially if volume confirms a bottoming process.

Notes on confluence:

The primary support at ~75.5 aligns with the horizontal trendline and recent lows.
The 82.2 level aligns with a near-term price reaction zone visible from recent rallies and current price action.
Moving averages are far above price, reinforcing the need for a robust price-based reversal and volume confirmation to re-anchor price above key averages.

Trendline implications:

If price holds around 75.5 and builds a daily close above 82.0 with increasing volume, the scenario shifts toward a bullish reversion signal toward the next resistance band near 90–92.

Technical Outlook & Summary

Price action context:
- The dominant pattern is a downtrend with occasional small-scale recoveries that fail to produce a durable reversal. The current price sits at a major support zone around $75–$76, where a reaction is likely in the near term. A break below this zone could open further downside toward the mid-70s or lower, while a hold could pave the way for a short-term bounce.
Volume analysis:
- Down moves are generally corroborated by higher-volume selling, indicating continued participation in weakness. Any meaningful reversal would likely require a notable increase in buying volume on rallies to push price back toward resistance levels and above the short-term moving averages.
Technical signals:
- Bearish momentum remains, as indicated by MACD being negative and price well below the 50-day and 200-day moving averages. However, the RSI is deeply oversold, creating a non-negligible risk of a near-term bounce if buyers step in.
- A durable reversal would likely require:
  - A close above ~82.0 on strong volume, followed by a test and possible break of the ~90–92 resistance zone.
  - A sustained positive MACD crossover (or a broad-based bullish price/volume confirmation).
Final takeaway:
- The near-term setup favors a cautious stance. A well-timed bounce could emerge from the $75–76 area, especially if accompanied by rising volume and a positive price action pattern around the $80–82 zone. However, until there is confirmation of a sustained reversal above ~82 and later above ~90–92, the broader trajectory remains bearish.
Practical notes for trading decisions:
- Risk management: If entering long near the $75–76 zone, consider tight stops just below the zone to limit downside exposure in case of a deeper break.
- If price revisits the $80–82 zone, watch for bullish candlestick patterns with volume confirmation before initiating a position.
- Monitor for a shift in volume dynamics on rallies as a leading signal of a potential trend change.

If you’d like, I can adjust the buy-zone definitions, add additional trendlines (e.g., a longer-term resistance around 90–92 or a downside channel), or simulate a few entry/exit scenarios based on alternative stop placements.

Finance Halo