Mapping the market: More losses in store for Netflix shares?
NFLX•Netflix shares have lost about a third of their value this year and recently traded around technical support at $61 to $62. A sustained drop below that range could lead to further support levels between $54.50 and $55, $48 and $50, and around $44, while a rise above $73 to $73.50 could challenge the downward outlook.
1. Support levels in focus
Netflix shares have lost about a third of their value this year, hurt most recently by disappointing guidance. The shares recently traded around support near $61 and $62, where structural support and a Fibonacci retracement converge. A sustained drop below that area could lead to the $54.50-to-$55 zone and then $48 to $50; another support level lies around $44.
2. Indicators point lower
Moving Average Convergence Divergence, the Relative Strength Index and Bollinger Bands all point to more losses for Netflix shares. The shares could move up and down before settling on a direction, but a rally above $73 to $73.50 would raise serious questions about a further decline.
