In our last review of Netflix (NFLX) on March 9 we wrote that, "The decline in NFLX could be over but that is not a reason to recommend purchase. Maybe a new base pattern can soon begin?" The shares have struggled in the past four weeks and now the fundamental analysts at BMO Capital and Barclays have cut their price targets for the subscription service.
Let's review the charts again.
In the daily bar chart of NFLX, below, we can see that the shares made their zenith in November and turned lower into a March nadir. Prices recovered modestly into April and have drifted back down towards the March low. NFLX is trading below the declining 50-day moving average line as well as the declining 200-day line.
The On-Balance-Volume (OBV) has been weak and is close to making its own new low for the move down, perhaps before prices do. The Moving Average Convergence Divergence (MACD) oscillator has crossed to the downside just below the zero line for a new outright sell signal.