Want to know what the next move is on Netflix (NFLX)? I’ve got your trade. (January 31, 2018)

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We are looking at Netflix ( NASDAQ: NFLX ), the reason is pretty obvious. After the company reported earnings the stock just kept going and going and going. I know I have covered this before but the first day this looked like kind of a gap and crap so to speak. A big rally up and then it started to drift lower. And you say, “Well, that is the factoring in of the good earnings.” Then the next day when the stock broke here, when the stock broke up above Tuesday’s intraday high, we will call it 258.00, then you know buyers are still coming for that stock and you have got to step back.

I will be honest, I had a couple errant trades on the upside that I lost money on; looking for a reversal I just didn’t close them soon enough. Anyway, the stock just keeps moving up here, this was last Friday, it keeps going. You have got to stay away or stay long, keeps going and then finally we get this today. What I am telling you is, this is kind of “The last of the Mohicans”. You think about this: Yesterday we got a lower high and a lower low than the prior day. Today we got 282.29 was today’s intraday high, 282.73. So now we did get a lower high today and a lower low today. So for two consecutive days the stock has been trading lower; this is the end of the road for this.

Now we are looking for a pullback. If we just go to a 2-day chart you can see it is very clear, up, up, up and then Bam! This is a reversal. If you are long this stock and you are looking at it as a trade, even if you are not looking at it as a trade, I think you have got to get out of this stock. I actually have a short position on this stock now. I don’t know how much I am going to get out of it but I’m looking to get probably, I would look for 10 points anyway.

I think you have got to get out of Netflix ( NASDAQ: NFLX ). If you see the way this stock has traded, this was how it looked today: It gaps up and then that was it. A big massive sell-off actually; it gapped up here and then traded down in a big way, then the rest of the day it has just kind of drifted. And then you get into the after hours and it is up a little bit. Why not? Because folks that were shorting this stock, they’re not all going to stay short.

So if it is me and I am you, I would look to short this stock. You have got to give it a little bit of room here about 5 percent anyway. I wouldn’t cover unless the stock trades above today’s intraday high of 282.30 we will call it. As long as the stock stays below 282.30 I think this is short that is going to work.

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