On November 5th, I pointed out that NFLX had a pennant formation that would give us a BUY CONFIRMED if the price went over $57.00. This actually happen 2 sessions later, and since then NFLX has continued to move up strongly along its major up trend. Obviously, I cannot keep track of all stocks for which I make predictions for and cannot always signal BUY CONFIRMED when they do occur. But if you had read my analysis then you would have needed me to do so as I indicated in the analysis itself that NFLX needed to go over $57.00 to get the BUY CONFIRMED. What I will try to do at the end of each month if time allows it, is look back to all the month's predictions and see where the stock moved since.
Here is the chart of my November 5th prediction:
Here is today's chart:
Based on the pennant formation that was confirmed, I have set a price target of $66.00 for NFLX, which is what I would consider the fair value for NFLX before the up trend may start settling down. This doesn't mean the price can't go higher, but simply what price point it may have tendency to go back to. This is what we call a negative feedback, which is a reversion to the mean, something I've seen happen on a few occassions with pennant formations. NFLX is currently a HOLD. Taking a position in NFLX now may provide with a certain return, but NFLX may not have too much fuel left in it to drive much higher. Basically, to make big returns you need to catch trends early and would have had to buy on the BUY SIGNAL or CONFIRMATION. However, NFLX is trading within a strong up trending channel and you could try to ride it as long as it holds.
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