To The Moon

$Netflix(NFLX)$  

📈 Netflix: Understanding the Reversal at 102, the Resistance at 108, and Why I Keep Accumulating Shares

When I look at Netflix’s intraday behaviour, the price action around the 102 level stands out as a textbook example of a reversal forming right at a demand zone. Early in the session, Netflix experienced heavy selling pressure, with volume spiking and red candles stacking one after another. This typically signals panic selling or forced liquidation after a negative catalyst or a broad-market dip. But what matters to me isn’t the fall itself — it’s where the fall stops.

🔹 Why Netflix Reversed at 102

The level around 102 acted as a natural support zone for several reasons:

1. Historical support area

In previous trading sessions and earlier intraday structures, Netflix had shown buying interest near this region. Markets tend to “remember” key price zones because that’s where liquidity sits. When the price revisits these areas, buyers often step back in.

2. Psychological round-number effect

Prices like 102, 100, 105 attract large orders from institutions and algorithms. These round zones create predictable behaviour because many traders place limit orders there. At 102, Netflix likely hit a cluster of buy orders waiting to be filled.

3. Volume confirmation

As Netflix dipped into 102, the selling volume began to taper off while the green bars started increasing. This shift in volume confirmed that sellers were exhausting while buyers were quietly taking over. Reversal signals are seldom about a single candle — it’s the behavioural change in volume that matters most.

4. Oversold technical condition

Indicators such as the short-term moving averages (VMA lines on your chart) were stretched far away from the price. When price becomes too extended from the averages, a snap-back or bounce becomes increasingly likely.

Because of these combined factors, 102 acted like a magnetic floor — sellers pushed the price into it, but once it touched that zone, the momentum flipped. Buyers regained control and Netflix slowly climbed back.

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🔺 Why Netflix Faced Resistance at 108

Later in the session, the recovery brought Netflix toward the 108 level, which quickly turned into a ceiling. To me, this resistance has a few strong explanations:

1. Previous supply zone

Every price drop leaves behind a cluster of traders who bought earlier and want to exit at breakeven. Around 108, many short-term holders had bought previously and were waiting for a chance to close their positions. This created selling pressure.

2. Moving averages converging at that level

On the chart, the VMA lines (especially the longer-term ones) hover around the 108–109 zone. When multiple moving averages cluster together, they act as dynamic resistance. Price often gets rejected until stronger buying volume comes in.

3. Sharp earlier sell-off from the same region

When a stock sells off aggressively from a price, that price becomes a memory point where bears regain confidence. Netflix had dropped from near 107–108 at the open, so revisiting this level triggered profit-taking and defensive selling.

4. Low afternoon volume

The volume tapered off significantly later in the day. Without heavy buying pressure, pushing through a resistance level becomes almost impossible. Netflix started to flatten, signalling indecision rather than weakness.

The overall picture is simple: 102 attracted strong demand, while 108 brought out supply. Until the market picks a direction with conviction, Netflix will keep oscillating between these key levels.

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💼 Why I Believe Netflix Has Strong Fundamentals

Beyond the day-to-day noise of charts, the reason I continue buying Netflix is grounded in fundamentals.

🔹 1. A globally dominant streaming platform

Netflix remains the world’s largest subscription streaming service, with unmatched content distribution and brand power. Its global footprint allows it to grow even when the U.S. market matures.

🔹 2. A proven, profitable business model

This is what sets Netflix apart from most tech/media names. It consistently generates profit, has strong cash flow, and is less dependent on advertising cycles compared to other platforms.

🔹 3. Aggressive content strategy with measurable returns

Its investment in original content continues to pay off. Netflix’s ability to produce global hits (Korean dramas, European series, international films) reduces dependence on Hollywood. This diversification strengthens long-term stability.

🔹 4. Their password-sharing crackdown boosted revenue

The crackdown initiative turned out to be one of Netflix’s best tactical decisions, converting millions of free watchers into paid subscribers.

🔹 5. New revenue streams

• Advertising tier (fastest-growing segment)

• Gaming ambitions

• Live events and sports experiments

These new verticals help Netflix future-proof itself. The company is no longer just “streaming” — it’s becoming a multifunction entertainment ecosystem.

🔹 6. Strong management and disciplined capital allocation

Netflix continues to reinvest aggressively but smartly. They cut inefficient spending and focus on content with global appeal rather than localized niche shows. Their operational efficiency keeps improving.

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🧾 Why I Keep Buying

For me, Netflix is the type of company I want to accumulate over time:

• It has durable long-term demand — people will always consume entertainment.

• The dips give me opportunities to lower my cost basis.

• I see it becoming even stronger after the stock split (which naturally attracts more retail interest).

• Its financials remain healthy, with revenue and cash flow trending upward.

• The company is evolving faster than its competitors.

Every dip toward 102–103 becomes a moment for me to add positions gradually. I am not chasing quick jumps — I am building a long-term position based on conviction.

Netflix has both the technical recovery patterns I like and the fundamentals I trust. And that combination gives me confidence to keep buying, even when the market tries to shake people out.

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@TigerStars @Wrtd @TigerStars @Daily_Discussion