Netflix is about to do something violent.
Either it finally breaks through this $1230 ceiling that’s been capping it, or it falls back and retests the lows. I’m betting on the breakout.
I’ve got call spreads on Netflix expiring October 10th, and I’m thinking about adding more.
Here’s why: Netflix has been testing this same resistance level around $1227 to $1230 repeatedly, but it’s not getting destroyed on these tests anymore. That tells me the selling pressure is weakening.
The Technical Setup I’m Betting On
When you see a stock repeatedly bang its head against the same resistance without breaking down hard, that’s actually bullish. It means buyers are getting more aggressive each time, and sellers are getting less committed.
Most people don’t understand trend line resistance.
They think it’s just a line on a chart.
But it represents a psychological level where enough traders think “this is too expensive” and start selling. Every failed test weakens that conviction.
Netflix has built a solid base here. The character of these resistance tests is changing – less violent rejection, more sideways grinding. That’s coiled energy.
Why I Like the Long Side Here
If Netflix clears $1230 with any kind of volume, there’s not much stopping it from running back toward the highs. My call spreads give me time to be right, so I don’t need this to happen tomorrow.
Most traders wait for confirmation before they buy. Problem is, by then you’re paying premium prices for yesterday’s idea. I’d rather get positioned before the move and let the market prove me right.
Volume is everything here. If Netflix grinds above $1230 on weak volume, I’m not getting excited. But if it powers through with conviction – that’s when buyers are really committed and this thing can run.
I’m also watching how it approaches the level. Does it build momentum into the test, or does it struggle and fail? The character of the move tells you whether this breakout attempt has legs.
Your Action Plan
I’m not betting the farm on Netflix, but I’m willing to risk enough that it matters if I’m right. The consolidation pattern gives me a clear level to define my risk – if we break below this range, the thesis changes entirely.
But as long as we’re holding this base, the breakout possibility stays alive. That’s worth positioning for.
Netflix is going to pick a direction soon, and I’m positioned for it to break higher.
This $1230 resistance level is getting weaker with each test. When it finally gives way, this thing should move fast.
Netflix breaking above $1230 with volume – that’s my signal. Until then, I wait.
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