We might have a great trade on Netflix (NFLX) tomorrow. (July 17, 2019)
NFLX
Netflix ( NASDAQ: NFLX ), they reported earnings and the numbers were pretty good but their subscribers actually shrunk, basically they said we kind of suck. That is really kind of the gist of it you don’t really have to look at anything else. The stock had already closed down on the day, not a big deal but down with everything else. Now it is trading about 12 percent down after hours.
This is the kind of thing that you can almost be certain is going to be a good trade tomorrow to the upside. Make no mistake about this, I am not talking about whether it’s a good thing, a great opportunity to buy Netflix ( NASDAQ: NFLX ). I don’t know. I subscribe but I don’t really use it so I have got nothing for you. What the numbers are, what the growth rate is, this and that and the other thing, I don’t know.
Here’s what I do know: It doesn’t come up on any of my screens that search for stocks that fit my type of trading, it just doesn’t. And so I couldn’t care less about Netflix ( NASDAQ: NFLX ) as a trade or an investment for me. Oh, but it’s up, whatever, since the low. I really don’t care, if I could go back here I would probably even buy something else other than Netflix ( NASDAQ: NFLX ). This stock has basically been a non-money maker for almost 6 months and now I think it is going to turn into a moneymaker for day traders.
This is what I would suggest doing: Tomorrow watch and see how this stock opens. Just see how it opens. I will give you a specific rule, formula; if 2-minutes after the market opens, that’s at 9:32, if it’s trading above the opening print, wherever it opens up, it might open up at 318.00, it might open up at 330.00 or down at 300.00, I don’t know. But wherever it opens up then this is what you do: Immediately snap a line there. That is your opening print wherever it is. If 2-minutes into the trading day the stock is up, it is still up above that opening print buy the stock and keep your stop, if it had traded down (and I am sure it will at some point), lower than where it opened keep your stop just a little bit below there, that’s really the deal.
Be mindful, I am almost pulling this out of my backside and telling you this because there is a lot more to day trading than just having a rule like this. But in a very, very general sense, and this is important, wherever the line is where the stock opens if it stays down there into the morning you need to be out of the stock. If it is above there then you need to be in the stock.
The reason is pretty simple, a stock like this tanks, takes a big, big, huge massive mess down here and the question you are asking yourself is, “Okay, are there buyers or sellers that are more aggressive right now, right here?” Not from up here, that was yesterday. Where are the buyers and where are the sellers right here? Who wants it more? Do the sellers want cash more than the buyers want the stock? You can answer that question very easily and that is, green box buy, red box sell, that’s most of it right there.
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