Not too long ago, I stated that my price target for Netflix (NFLX) was $130. Fast-forward 2 months and the stock now sits at $132. See original chart here.
Just like with any stock, once a price target (good or bad) is met, it is time to reevaluate your holding. In other words, do we need to sell or is there more upside left in the stock?
Below are some charts that should help us answer this question. Like always, let me know what you think of Netflix, in the comments below.
First, lets take a look at the initial call. You can clearly see the 20 point range that had been created between $90 and $110, which helped me establish the price target of $130.
Now that the price target has been met, we need to see what is left of this stock.
For a stock that has consistently moved higher for nearly 2 years now, it can be hard to imagine even more growth in price to come. That is why stops are always a good tool to use in stock trading. Why sell, if the stock doesn’t make us?
In the chart below, a cup and handle pattern has been formed – with a 22 point jump between the top of the cup and bottom. We add this to the breakout spot of the handle and we get the new price target of $139. Learn more about this pattern and more at ChartPatternManifest.com.
The dotted red line, shows us a support area around $125.
Ultimately, it is possible that we see a minor pullback here before making another push higher. Then again, from the initial call of $22, I think we got some leeway in terms of stop losses.
Don’t trust me? See what MarketClub’s triangle trade has to say about Netflix’s outlook.