Netflix Stock Sets New Record: Live Stream Elliott Wave Opportunity
by Nico Isaac
Updated: May 21, 2020
I'm Nico Isaac and THIS is chart of the Day.
Netflix Stock Sets New Record: Live Stream Elliott Wave Opportunity.
Netflix Inc. may be a leading provider of entertainment -- but for investors, the real source of binge-worthy drama has been streaming in the company's stock.
This chart of the media giant shows that, since mid-March, prices have leapt higher than one of Joe Exotic's tigers with a record high on May 19.
Mainstream experts cited one obvious CAT-alyst for the rally: the coronavirus lockdown, which, in turn, increased demand for at-home diversions. Writes one May 15 CNBC:
"Demand is off the charts right now, and it's the integral driver for Netflix. It's a massive market and people aren't going to go to the movies... It creates almost a perfect storm to the upside."
Where, then, was that "perfect storm to the upside" as recently as mid- March -- when the pandemic lockdown was taking full effect, and yet Netflix shares stood at a three month... LOW?
Answer: Far from an "upside storm," conventional wisdom said the opposite. In March, these sources worried the stay-at-home orders amounted to a bearish setback for Netflix.
March 10 Barron's "Coronavirus Could Actually Hurt Netflix Stock"
March 11 Yahoo Finance! "Netflix Could Be Laid Low by Coronavirus"
March 10 Forbes: "Three Reasons the Coronavirus Bad Business for Netflix"
Explained one March 16 CNBC
"People staying at home may be streaming more Netflix, but that doesn't mean the stock is coronavirus proof. The streamer does not benefit from an increase in viewing hours due to its flat-rate subscription and lack of advertising."
If anything, record unemployment and drastic belt-tightening made Netflix a candidate for the non-essential chopping block. The notion that its share price would reverse course and turn up in a historic rally was NOT on the mainstream radar.
It was, however, on the Elliott wave radar -- as far back as January.
In his January 28 Trader's Classroom, editor Jeffrey Kennedy identified a triangle underway on Netflix's price chart. This meant prices would see two main phases in the months ahead. "Further sideways price action, and then further rally."
Price continued sideways in February and the first half of March - up, then down below $300 per share before the closing low on March 16th. From there, Jeffrey's call for further rally took on speed.
In the April 2 Trader's Classroom, Jeffrey revisited Netflix, confirming the larger uptrend was in full force and it was time to embrace the upside with this bold arrow pointed higher.
From there, the angle of ascent was straight up, as prices gained $80-plus per share.
Whether people continue to binge-watch Netflix remains to be seen. Right now, however, Trader's Classroom is streaming high-confidence trade set-ups LIVE on the price charts of the biggest names in media, technology, finance, telecommunications, retail, and more.
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