Netflix (NFLX) is scheduled to report its fourth-quarter results after the close of trading here on Thursday. Let's check out the charts and indicators of the streaming giant to see what they may hold of Netflix shares.
In this daily bar chart of NFLX, below, I see a series of lows in May, June and July. A rally from these lows has unfolded, but now I see twin highs in the $330 area in December and January. Prices are trading above the 50-day moving average line and above the 200-day line, but the latter does not show a positive slope like the 50-day. The trading volume does not look like it has increased the past six months but the On-Balance-Volume (OBV) line does show a rise from May, telling me that traders have been more aggressive buyers. The Moving Average Convergence Divergence (MACD) oscillator is bullish.
In this weekly Japanese candlestick chart of NFLX, below, I see a less-than-robust picture. Prices have advanced from May/June where I see a number of lower shadows. Prices are above the 40-week moving average line but it has not bottomed yet. The weekly OBV line has wobbled the past four months and is not giving a strong confirmation signal. The MACD oscillator is above the zero line but it has been narrowing for several weeks.
In this daily Point and Figure chart of NFLX, below, I can see the software is projecting an upside price target in the $435 area.
In this weekly Point and Figure chart of NFLX, below, a price target of $491 is suggested.
Bottom line strategy: I have no knowledge of what NFLX is going to tell shareholders and analysts this evening. The charts are mixed but the indicators suggest a cautious approach may be the best strategy in the short run. I would stand aside.
