Are you in the mood for a GOOD flick?

PLAY OF THE DAY: NFLX

flix

*click on chart to zoom in

Netflix is reporting earnings on Monday October 17th. Stock is up over 7% already, this week alone. Part of this is attributable to rumours on Twitter that Disney wants to make an M&A play for NFLX? Amusing as this may sound…and as much as it nauseates me to even acknowledge Twitter…rumours on both Twitter and StockTwits.com seem to take on a life of their own these days. With “credible news outlets” (eh?) relying on Twitter as “unnamed sources”.  Well blow me down… In any event, let’s go to the video tape here and crack this bad boy open:

  1. On Monday of this week, NFLX broke through top heavy resistance established back on September 6 2016
  2. During today’s session NFLX smashed through even heavier resistance established on May 26 2016 in the $103+ area
  3. Today’s high on NFLX has pierced the mid point of the down leg which originated during the week of December 11 2015 near $133.27 and bottomed near $79.95 the week of February 12 2016
  4. Volume over the past 3 sessions has smashed through it’s 50 day average volume. There is something going on here.
  5. Last and certainly not least – Money Flow Index – (Money Flow was the indicator developed by Don Worden back in the 1970’s) which gave birth to Money Stream. That is a topic for another post, lest I digress. But the clue here is Money Flow is CLEARLY rising and has not reached overbought levels yet. We can deduce from this last bullet, that strong hands are coming in – not just retail pikers.

So to wrap this hideous screed here, some final thoughts…I think the whole DIS (Disney) big buy out rumour sounds pretty Mickey Mouse to me, at best. The play here really is – the inflow of money in to the stock ahead of earnings.

And on the subject of earnings, you can expect several things. Count on the fact that NFLX like every other FANG component has guided expectations “under” for analysts. Why would they do that? So they can beat and blow out expectations. They, like all their other peers will use NON GAAP (a/k/a “cooking the books” or “fucking the dog”) accounting methods.  Bottom line, earnings surprise – the algo’s that fire off on news headlines will pile on the buy triggers w/o reading the actual earnings statement. MOONSHOT followed by many bag holders a few days hence.

Based on weekly trend diatonics – I see immediate upside to $111.85 followed by $115.64 heading in to earnings 11 days from now. From today’s close near $106.30 – As far as post earnings? That is a lottery ticket…and should be treated as such. At the end of the day…it is bound to be a good flick!

I am KingCAMBO…or used to be anyway..smoke em’ if ya got em, and that’s how I roll…on NFLX

 

Good As Gold?…perhaps maybe but not YET

nem

This is my first post in many a blue moon…so forgive me while I shake the cobwebs out from between my ears. A good friend down in Marco was asking for my thoughts on Newmont Mining as a play. Instead of bloviating on it – I will just share my reply here:

Okay… the daily chart has been eviscerated, so we need to zoom out to a weekly chart to see the bigger picture. Take a look at my footnotes below the chart:

1. Is the low price from the week of August 28th 2015. The last major bottom.

2. Is the most recent significant low from the week of May 27th 2016

3. This weeks action has blown up a very heavy support diatonic near $36

4. Curiously enough the $30.84 area (call it $31) is the midpoint of the 2015 bottom to the week of August 12th 2016 top. And this is the most important. At the midpoint of a major leg – there are 50% winners and 50% losers. This where the majority of the stop loss orders will be placed. Either the Bulls or the Bears will capitulate here on margin calls. “loot a burning house” theory…

5. Consider this too – look how extremely low the volume has been on this meltdown… that should tell you two things – a.) Institutions, and hedge funds, banks and strong hands are not the ones dumping. -and- b.) this is RETAIL selling or what I affectionately would refer to as a “Piker’s Panic”. I can’t see any reason to try to front run a long trade until it tests and holds the $31 +/- area

be well,
KingCAMBO