Hello Real Life Traders, stock market fans and investors all over the world. I trust you are doing most splendid!
Earnings season is here and as a day trader and also options enthusiast, I am a big fan on trading NFLX and I’ve got my eyes on it pretty much daily.
Today is a big day because the earnings report is out. If you’re a fundamental fan of NFLX, you might enjoy some of these numbers I gleamed from Yahoo Finance.
NFLX “added just 160,000 domestic subscribers in the second quarter, which fell far short of the already reduced guidance of 500,000 additions.” Also NFLX added only 1.5 million international subscribers, compared with guidance of 2 million.”
These are still huge numbers folks. NFLX is still growing, just not as rapidly as management wants. Their Revenue of $1.2 billion was inline was guidance while earnings per share of $0.09 beat expectations, but guidance on earnings per share for the coming quarter was seen as disappointing, at $0.05 versus $0.08.”
NFLX is spending a lot more time, money and assets into their original shows – but their recurring monthly revenue model is still a very solid one that will stand the test of time, especially with their quality of content.
This article along with My last article on NFLX will be focusing on the open after its earnings.
As I write, NFLX is down about 14% post market. My recent interactive chart shows the levels I was interested in.
So, what now? Well, my thoughts are simple. If NFLX opens below a key support level of $84.81, I’ll be pretty hesitant on the bullish bounce. It of course could happen, but I’ll wait a few hours or days before I pull any triggers. If NFLX can open above $85, It has hope of a bounce. $84.81 was the ‘Brexit low’, but it did have a low of $79.95 back in Feb which would still be a solid support. The 100 SMA on a weekly is at $87.04
An open above that and I really like NFLX chances to continue higher. Much higher into 2016. NFLX is quality people.
The plan: If it opens in my bullish zone, I plan on buying some Aug or Sep (depending on their pricing) $95 calls. One could also plan on buying shares down here or selling some puts. The first 4-5 mins of this gap likely will be crucial. Regardless of how much selling it gets, I would still like to own NFLX down here and will look for a place to do so. My dollar cost average at this point would be down significantly after about 13 or 14 successful put sales on NFLX in a row.
Traders, I’m really excited to see what happens! This one will be close!
If you have any questions, feel free to email me! jerremy@reallifetrading.com
Until next time – remember – Love Life, live life and trade it!
