Using Symmetry Projections on Netflix

 | Jul 17, 2013 | 8:30 AM EDT
  • Comment
  • Print Print
  • Print
Stock quotes in this article:




One of the ways I like to trail a stop in any of these trade setups is via what I like to call symmetry. Another name for symmetry is a measured move.

Many traders don't have an issue getting into a trade and placing an initial stop. Some, however, have a problem with exits. With each trade setup that I walk you through, I like to define the risk very clearly and also give you ideas for targets on the setup. Some will exit the trades at targets, but what if the stock just wants to keep moving in the right direction? This is why I want to talk about Netflix (NFLX) and the current symmetry decisions and how you might trail a stop up.

Looking at the daily chart in this one, you can see that this was actually an old setup that fired off a secondary trigger when the original zone was retested. The secondary trigger on the chart occurred when the $218.25 swing high was taken out, and the rest is history.

Since major target No. 1 at the $260 area was met, the question will be, can we meet target No. 2 next? Honestly, I don't know the answer to that question. I can, however, suggest a way to stay in partial positions to see if we can get there. For this I like to use my symmetry projections on a lower time frame. If price can hold above these projections, then you can keep some of Netflix and see if it can continue higher. If this same key support is violated, I would ditch the balance of any long positions and look for another setup instead.

NFLX Daily

I am illustrating what I call symmetry on the 39-minute chart. Each time a new high is met in Netflix, I project 100% of the prior corrective declines that I have marked on this 39-minute chart. As long as we don't violate this symmetry, I'm OK with keeping some longs in Netflix.

The zone currently comes in at the $254.85-$257.99 area. Therefore I would have a stop below the $254 handle. Keep in mind that if we make a new high in Netflix, this zone would have to be recalculated. Bottom line, we have met a major target in this one. I recommend booking profits on most, but if you keep some, keep trailing those stops up as you go!

NFLX 39-Minute
Dynamic Trader

I also have no interest in catching a falling knife, but I am watching $105.44-$106.61 for possible support in Tesla (TSLA). Remember that in my work, no trigger no trade. Let this stock settle down, and if it does hold this key support, be patient for a trigger that tells you whether it's worth placing a bet against the zone.

TSLA Daily

Columnist Conversations

Foot Locker's (FL) less than expected quarterly earnings set off a round of selling the entire athletic appare...
View Chart »  View in New Window » Gold has met the first upside target off the last setup zon...



News Breaks

Powered by


Except as otherwise indicated, quotes are delayed. Quotes delayed at least 20 minutes for all exchanges. Market Data provided by Interactive Data. Company fundamental data provided by Morningstar. Earnings and ratings provided by Zacks. Mutual fund data provided by Valueline. ETF data provided by Lipper. Powered and implemented by Interactive Data Managed Solutions.

TheStreet Ratings updates stock ratings daily. However, if no rating change occurs, the data on this page does not update. The data does update after 90 days if no rating change occurs within that time period.

IDC calculates the Market Cap for the basic symbol to include common shares only. Year-to-date mutual fund returns are calculated on a monthly basis by Value Line and posted mid-month.