Netflix has moved passed its accumulation phase into a mark-up phase. It is trading above its black 200-day simple moving average, and, importantly, the SMA is pointing up. We have added On Balance Volume (OBV) as the indicator underneath the price chart. Volume is a measure of supply and demand. In this case both the price and OBV are coordinated and trending up. According to OBV theory, this connotes that the uptrend is likely to continue.
The market is rewarding the password-sharing clampdown and the launch of its advertising supported tier of service. Netflix is hoping by cracking down on password sharing, subscribers will pay more to add extra users and that new subscribers will sign up for their own accounts. The cheaper tier may well be attractive to new subscribers that were previously sharing a password.
Senior Market Specialist
Russell Shor joined FXCM in October 2017 as a Senior Market Specialist. He is a certified FMVA® and has an Honours Degree in Economics from the University of South Africa. Russell is a full member of the Society of Technical Analysts in the United Kingdom. With over 20 years of financial markets experience, his analysis is of a high standard and quality.