We’re kicking off a new tradition at tickertank.com today, and we’re calling it 20 on 20. Today tickertank.com’s staff will push out 20 stock/etf/futures analysis blog posts, free for everyone to see, in an effort to get you great insight into the markets.
First up, Netflix. More than just our favorite way to watch “Dr. Who”, NFLX is a quirky retail stock that traditionally has big earnings swings and lots of volatility. The image above gives you a look at the last 6 months of trading, and it’s pretty clear that NFLX is on the upper end of its range.
Normally we’d see the 200-day simple moving average (the red line on the chart) as a significant source of resistance, but the stock is already $2 higher than that level and looks like it has more room to run. We’re looking at July’s highs around $86 to be a more firm stopping point for this bullish run.
As far as trades, if you’re looking to sell spreads, you may want to avoid any short calls below the $86 strike price. Aggressive traders may enjoy selling Dec12 80 puts, just below the 200-day SMA and around an interesting support level. If the stock peters out before hitting $86, it’s still pretty likely that it will hover above $80 for a few weeks. Any put strategy could be a nice play if that support level holds.
If you like the analysis, you’ll get plenty more by signing up for our Options Strategy Alerts here. Let 20 on 20 begin!