Netflix Inc. Stock Code NFLX.NAS
Outlook
Price is near to a strong gap resistance at $387.43. This is the lower resistance of the gap with the higher resistance at $392.25. This gap has capped price rally since July 2018. A previous test of this resistance resulted in a price decline from $387.43 to $231.55. Price has been moving sideways since Feb 2019 with new highs along the way but MACD has been showing divergence warnings as price made new highs. This could be a warning of a possible price high in the making. A weak momentum in the MACD indicator is also another sign of weakness in the price rally. We do not think price is able to move beyond $392.25 and a price to close the gap would be an opportunity to get into short position for a potential move back to $320
Strategy
$374.35 Short Sell
$320.00 Price Target
$394.10 Risk Management Stop
4 weeks Trade Duration
Merck & Company Inc. Stock Code MRK.NYS
Outlook
Price, after breaking below the cloud, has climbed up near to the edge of the cloud. Price is currently still below the cloud as well as its Base line. This is an indication of a bearish price trend. Base line at $78.08 and cloud resistance at $77.60 are likely to act as resistance points to cap the price rally. MACD is still bearish and both lines in MACD indicators are far away from the zero line, indicating a strong bearish trend. The rally from the low of $72.28 could be a corrective rally and an opportunity to get into a short position.
Strategy
$77.80 Short Sell
$70.90 Price Target
$79.53 Risk Management Stop
4 weeks Trade Duration
