Market Curiosity: Exploring Markets And Systems

January 9, 2011

Short NFLX

Filed under: Short Stock — Tags: — Jeff Fitzmyers @ 7:10 pm

Wait, didn’t I just try to short a momo and it did not work out? Yes. And here I go again. And again, this trade should work out quickly one way or another. ST did not have such negative volume.

Buy a Feb 175 put if price drops past around 176.38. (half position)
Stop loss around 185.20

– Weekly CCI trending down and below zero.
– 5 Distribution days since the recent top.
– The one accumulation day did not amount to much.
– In fact the 2 up days last week were quickly and mostly retraced.
– Broke the uptrend line, and frequently under a now flat 34 EMA.
+/- Earnings on January 24th.
+/- Short interest is about 30%. That’s a lot. There is a risk of forced short covering.
– RSI is > 70 on the monthly and recently weekly time frames.
+/- This recent gap on Nov 11th has basically been closed without the stock moving up. I assume that is a bit negative. The 2 other recent gaps did not get filled. A sign of strength.

UPDATE Jan 11: Price did not fall, so no trade. The daily CCI did cross above the weekly CCI and that’s bullish. But I liked the other stocks on the weekly outlook better.

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