Let’s break down the chart for Netflix (NFLX) on this 4-hour timeframe and analyze the setup for trading in the coming week, starting April 21, 2025. The chart provides a mix of technical indicators, price action, and annotations that can guide our trading strategy. However, please note that trading involves risk, and this analysis is for educational purposes only—you should always do your own research and consider your risk tolerance.
Chart Analysis
1. Price Levels and Trend
• Current Price: NFLX is trading at $1,007 as of April 20, 2025, up 11 points (+1.19%) on the 4-hour chart.
• Recent Highs and Lows: The chart shows a high of $1,067 and a low of $813 within the displayed timeframe (early 2025). The price has been volatile, with a sharp drop followed by a recovery.
• Moving Averages: The chart appears to use moving averages (likely the 20-period and 50-period, based on typical TradingView setups). The price is currently interacting with these averages, suggesting a potential consolidation or breakout zone.
2. Key Levels and Annotations
• Resistance (Break/Retest): There’s a resistance zone around $1,007–$1,067, marked as “Break” and “Retest.” The price recently broke through this level and is now retesting it, which could act as support if the retest holds.
• Support: A key support zone is around $938–$948, labeled “Fortune AI.” This level was tested multiple times and held as support during the recovery.
• Lower Support: Another support level exists around $850, marked as a “Break” zone where the price previously found a bottom.
3. Trade Signals
• Short Signal: A “SHORT” signal is marked around $962, which aligns with the recent pullback from the $1,067 high. This suggests a bearish move was anticipated, but the price has since moved higher.
• Long Signal: A “LONG” signal is marked around $850, which was the bottom of the sharp drop. This signal paid off as the price rallied to $1,007.
• Current Bias: The chart shows a “Bull” bias on the 1-hour, 4-hour, and daily timeframes, indicating a broader uptrend despite the recent volatility.
4. Indicators
• RSI (Relative Strength Index): The RSI is overbought (“Ove”), which suggests that NFLX might be due for a pullback or consolidation. Overbought conditions often precede a correction, but in strong trends, prices can remain overbought for extended periods.
• MACD: The MACD is showing a “Down” signal, indicating bearish momentum in the short term. This could mean a potential pullback before the next leg up.
• ADX (Average Directional Index): The ADX trend is “Down,” suggesting that the trend strength is weakening, which aligns with the idea of consolidation or a pullback.
• Aroon: The Aroon indicator shows a “Down” trend, further supporting a potential short-term bearish move or consolidation.
• Volatility: Volatility is marked as “Green C,” which might indicate increasing volatility, potentially leading to larger price swings.
• Red Candles: The presence of “Red Can” (red candles) suggests bearish price action in the recent candles, which aligns with the MACD and Aroon signals.
5. Timeframe Context
• The chart is on a 4-hour timeframe, and the session volatility is marked as “Green,” meaning the current session is active with potential for movement.
• The broader trend (daily timeframe) is bullish, which suggests that any pullbacks might be buying opportunities within the larger uptrend.
Trading Strategy for the Coming Week
Given the analysis, here are two potential setups for trading NFLX this week:
Scenario 1: Bullish Continuation (Buy on Pullback)
• Rationale: The broader trend is bullish (1-hour, 4-hour, daily), and the price is retesting a key breakout level around $1,007. If this level holds as support, it could be a good opportunity for a long position.
• Entry: Look for a pullback to the $1,007–$1,000 range. Confirm the entry with a bullish candlestick pattern (e.g., a hammer or engulfing pattern) or a bounce off the moving averages.
• Target: The next resistance is around $1,067 (recent high). If momentum continues, NFLX could push toward $1,100, a psychological level.
• Stop Loss: Place a stop below the $1,000 support, around $995, to account for minor wicks. If the price breaks below $1,000, the bullish setup is invalidated.
• Risk/Reward: Targeting $1,067 from $1,007 gives a 60-point gain, with a 12-point risk, yielding a risk/reward ratio of about 5:1.
Scenario 2: Bearish Pullback (Short Opportunity)
• Rationale: The RSI is overbought, and the MACD, Aroon, and ADX suggest short-term bearish momentum. The price may pull back to test lower support levels before resuming the uptrend.
• Entry: Enter a short position if the price fails to hold $1,007 and breaks below with a bearish confirmation (e.g., a strong red candle or break of the moving averages).
• Target: The first target is the $948–$938 support zone (“Fortune AI”). If momentum continues, the price could drop to $850.
• Stop Loss: Place a stop above $1,020 to account for a potential retest of higher levels. This keeps the risk tight.
• Risk/Reward: Targeting $948 from $1,007 gives a 59-point gain, with a 13-point risk, yielding a risk/reward ratio of about 4.5:1.
Key Levels to Watch
• Upside: $1,067 (resistance), $1,100 (psychological level).
• Downside: $1,000 (immediate support), $948–$938 (key support), $850 (lower support).
Risk Management
• Position Sizing: Risk no more than 1–2% of your account on any single trade. For example, if your account is $10,000, your maximum risk per trade should be $100–$200.
• Volatility: The chart indicates increasing volatility (“Green C”). Be prepared for larger price swings and adjust your position size accordingly.
• News Catalysts: Netflix’s stock can be influenced by earnings, subscriber growth, or market sentiment. Since I don’t have access to recent news, you might want to check for upcoming events (e.g., earnings reports) that could impact the stock.
Final Thoughts
The bullish trend on multiple timeframes suggests that buying on dips might be the higher-probability trade, but the overbought RSI and bearish short-term indicators (MACD, Aroon) indicate a potential pullback first. I recommend watching the $1,007 level closely on Monday, April 21, 2025. If it holds as support, a long position could be favorable. If it breaks, consider a short toward $948–$938.
If you’d like me to search for recent news or analyst updates on Netflix to refine this strategy, let me know! Trading is inherently uncertain, so always trade with a plan and manage your risk carefully.
Chart Analysis
1. Price Levels and Trend
• Current Price: NFLX is trading at $1,007 as of April 20, 2025, up 11 points (+1.19%) on the 4-hour chart.
• Recent Highs and Lows: The chart shows a high of $1,067 and a low of $813 within the displayed timeframe (early 2025). The price has been volatile, with a sharp drop followed by a recovery.
• Moving Averages: The chart appears to use moving averages (likely the 20-period and 50-period, based on typical TradingView setups). The price is currently interacting with these averages, suggesting a potential consolidation or breakout zone.
2. Key Levels and Annotations
• Resistance (Break/Retest): There’s a resistance zone around $1,007–$1,067, marked as “Break” and “Retest.” The price recently broke through this level and is now retesting it, which could act as support if the retest holds.
• Support: A key support zone is around $938–$948, labeled “Fortune AI.” This level was tested multiple times and held as support during the recovery.
• Lower Support: Another support level exists around $850, marked as a “Break” zone where the price previously found a bottom.
3. Trade Signals
• Short Signal: A “SHORT” signal is marked around $962, which aligns with the recent pullback from the $1,067 high. This suggests a bearish move was anticipated, but the price has since moved higher.
• Long Signal: A “LONG” signal is marked around $850, which was the bottom of the sharp drop. This signal paid off as the price rallied to $1,007.
• Current Bias: The chart shows a “Bull” bias on the 1-hour, 4-hour, and daily timeframes, indicating a broader uptrend despite the recent volatility.
4. Indicators
• RSI (Relative Strength Index): The RSI is overbought (“Ove”), which suggests that NFLX might be due for a pullback or consolidation. Overbought conditions often precede a correction, but in strong trends, prices can remain overbought for extended periods.
• MACD: The MACD is showing a “Down” signal, indicating bearish momentum in the short term. This could mean a potential pullback before the next leg up.
• ADX (Average Directional Index): The ADX trend is “Down,” suggesting that the trend strength is weakening, which aligns with the idea of consolidation or a pullback.
• Aroon: The Aroon indicator shows a “Down” trend, further supporting a potential short-term bearish move or consolidation.
• Volatility: Volatility is marked as “Green C,” which might indicate increasing volatility, potentially leading to larger price swings.
• Red Candles: The presence of “Red Can” (red candles) suggests bearish price action in the recent candles, which aligns with the MACD and Aroon signals.
5. Timeframe Context
• The chart is on a 4-hour timeframe, and the session volatility is marked as “Green,” meaning the current session is active with potential for movement.
• The broader trend (daily timeframe) is bullish, which suggests that any pullbacks might be buying opportunities within the larger uptrend.
Trading Strategy for the Coming Week
Given the analysis, here are two potential setups for trading NFLX this week:
Scenario 1: Bullish Continuation (Buy on Pullback)
• Rationale: The broader trend is bullish (1-hour, 4-hour, daily), and the price is retesting a key breakout level around $1,007. If this level holds as support, it could be a good opportunity for a long position.
• Entry: Look for a pullback to the $1,007–$1,000 range. Confirm the entry with a bullish candlestick pattern (e.g., a hammer or engulfing pattern) or a bounce off the moving averages.
• Target: The next resistance is around $1,067 (recent high). If momentum continues, NFLX could push toward $1,100, a psychological level.
• Stop Loss: Place a stop below the $1,000 support, around $995, to account for minor wicks. If the price breaks below $1,000, the bullish setup is invalidated.
• Risk/Reward: Targeting $1,067 from $1,007 gives a 60-point gain, with a 12-point risk, yielding a risk/reward ratio of about 5:1.
Scenario 2: Bearish Pullback (Short Opportunity)
• Rationale: The RSI is overbought, and the MACD, Aroon, and ADX suggest short-term bearish momentum. The price may pull back to test lower support levels before resuming the uptrend.
• Entry: Enter a short position if the price fails to hold $1,007 and breaks below with a bearish confirmation (e.g., a strong red candle or break of the moving averages).
• Target: The first target is the $948–$938 support zone (“Fortune AI”). If momentum continues, the price could drop to $850.
• Stop Loss: Place a stop above $1,020 to account for a potential retest of higher levels. This keeps the risk tight.
• Risk/Reward: Targeting $948 from $1,007 gives a 59-point gain, with a 13-point risk, yielding a risk/reward ratio of about 4.5:1.
Key Levels to Watch
• Upside: $1,067 (resistance), $1,100 (psychological level).
• Downside: $1,000 (immediate support), $948–$938 (key support), $850 (lower support).
Risk Management
• Position Sizing: Risk no more than 1–2% of your account on any single trade. For example, if your account is $10,000, your maximum risk per trade should be $100–$200.
• Volatility: The chart indicates increasing volatility (“Green C”). Be prepared for larger price swings and adjust your position size accordingly.
• News Catalysts: Netflix’s stock can be influenced by earnings, subscriber growth, or market sentiment. Since I don’t have access to recent news, you might want to check for upcoming events (e.g., earnings reports) that could impact the stock.
Final Thoughts
The bullish trend on multiple timeframes suggests that buying on dips might be the higher-probability trade, but the overbought RSI and bearish short-term indicators (MACD, Aroon) indicate a potential pullback first. I recommend watching the $1,007 level closely on Monday, April 21, 2025. If it holds as support, a long position could be favorable. If it breaks, consider a short toward $948–$938.
If you’d like me to search for recent news or analyst updates on Netflix to refine this strategy, let me know! Trading is inherently uncertain, so always trade with a plan and manage your risk carefully.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.