On the surface, Netflix (NFLX) looks like a hot property. Subscriber growth is still strong, revenue just beat expectations, and the platform remains deeply embedded in global culture.
And yet, the stock’s performance tells a very different story.
In this Market on Close clip, Senior Market Strategist John Rowland, CMT, and co-host “Twitter Tom” discuss why NFLX is one of the most aggressively punished mega-cap stocks in the market — and why patience may matter more than conviction right now.
The Market Is Voting, and It’s Not Happy
Netflix is currently trading near $85, down 36% from its 2025 highs.
More importantly from a technical perspective, the stock is trading far below its 200-day moving average – by the widest margin in more than three years, to be specific.
That’s not noise. That’s the market sending a message.
As John points out in the clip, price action reflects collective investor opinion, and right now, investors are not buying what Netflix is selling — regardless of how strong the underlying business may look.
The Fundamental Disconnect: Record Growth vs. Falling Stock
Here’s where the contradiction gets interesting.
Netflix just crossed 327 million paid subscribers, adding more than 25 million net users in 2025. Q4 revenue grew 18% year-over-year, beating expectations.
Based on fundamentals alone, this doesn’t look like a broken company.
But NFLX stock isn’t trading on subscriber growth. It’s trading on risk.
The Warner Bros. Overhang
One of the biggest clouds hanging over Netflix is the company’s proposed $72 billion all-cash bid for Warner Bros. Discovery (WBD), a move that has rattled investors.
Markets are concerned about:
- Balance-sheet stress
- A pause in buybacks
- Strategic risk in large-scale M&A
The deal drama created a technical gap near $90, which John highlights as a critical resistance level. Until that gap is reclaimed, any bounce risks running straight into supply.
This is why, despite oversold conditions, the chart still matters more than the headlines.
“Oversold” Doesn’t Mean NFLX is a Buy
Netflix recently pushed outside the lower Bollinger Band, and its RSI reached deeply oversold levels — conditions that often lead to short-term snap-back rallies.
But John makes an important distinction: a bounce does not automatically mean a good trade.
With Bollinger Bands still relatively narrow, the odds of a clean “band-to-band” mean reversion are lower. That makes risk/reward unattractive for traders looking to fight the dominant downtrend.
This is where Barchart’s chart templates come into play.
Using the 13-EMA to Define Risk
One of the tools discussed in the clip is the 13-EMA template, which helps traders quantify whether a contra-trend trade offers enough upside relative to downside.
John’s rule of thumb is simple: if the trade doesn’t offer at least 5-to-1 reward-to-risk, it’s not worth forcing.
At current levels, a snap back toward $90 offers limited upside, while downside risk remains open — especially if broader market pressure continues.
From a trading standpoint, the setup fails the math test.
Is This a Meta-Style Opportunity?
Naturally, mega-cap comparisons come up.
In 2022–2023, Meta Platforms (META) looked broken, and was trading below key moving averages — before launching a historic recovery.
Could Netflix be setting up for something similar?
Possibly. But John stresses that Meta’s turnaround only became actionable after a clear change in trend and character. Netflix hasn’t shown that yet.
Where Would Long-Term Buyers Start Paying Attention?
From an investment perspective, the conversation shifts from “oversold” to structure.
John notes that Netflix is currently bouncing from levels that have already been tested multiple times. For longer-term investors, he prefers:
- Fresh demand zones
- Untested retracements
- Evidence of trend stabilization
Those conditions appear lower, roughly in the $68–$74 range, unless the stock can reclaim key moving averages and close the $90 gap.
Until then, this remains a patience trade, not a conviction buy.
The Bigger Lesson
Netflix is a textbook example of why fundamentals alone aren’t enough to build a successful trade.
The business might be strong, but the stock can still be weak.
That’s why Market on Close focuses on what price is doing, not what narratives are saying — and why Barchart’s technical tools matter when headlines get loud.
Sometimes the best trade is waiting. And sometimes, the most important signal is the one telling you not to act yet.
Watch the clip to hear John’s NFLX analysis:
- View NFLX stock with 13-EMA chart template
- Stream the full episode of Market on Close
- Sign up to be notified ahead of the next live session
On the date of publication, Barchart Insights did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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