Ahhh! Now we know why NFLX traders have been wetting their pants with excitement over this stock lately! An article in Monday’s Wall Street Journal described how the company is slowly gaining a foothold in Hollywood, bankrolling “content” and finding new ways to stream and distribute it.  On the strength of this highly speculative turnaround story, Wall Street’s criminally inept stewards of OPM have spared no excess in bidding Netflix shares into the ionosphere.  One might think the company had discovered, if not a cure for cancer, then a fabulous new way to produce hit shows effortlessly and with little money at risk. In fact, Netflix has a long way to go before it can wheel and deal its way to the kind of revenues the company earned when home-delivered DVDs were the best idea since sliced bread.

Technically speaking, the stock’s latest wilding spree was telegraphed by the failure of the last correction to reach an obvious and ostensibly important trendline (see inset). Now the stock appears bound for a minimum 239.87, the Hidden Pivot target of the minor pattern at the right-hand edge of the chart. Camouflageurs may find a good opportunity to position themselves for the move, since the stock has stalled at the 233.86 midpoint pivot.  I’d suggest looking for your entry spot near these levels by using impulse legs on the 5-minute chart or less.  You can learn to do this stuff yourself. Click here.  _______ UPDATE (9:43 a.m. EDT):  Su-prize, su-prize:  The launch phase of today’s obligatory short squeeze hit 239.39, and now a second, lunatic leg up is bound for perhaps 244.47. There was little chance for bulls to play this move until the second phase of it was underway, 1-minute: A=232.87, B=239.39, B=238.18, for X=239.81 (and p=241.44). ______ UPDATE (July 9, 10:14 pm. EDT): With the OPM lunatic fringe manufacturing the momentum in this stock, it was time to look at a bigger picture (see inset, a fresh chart). Netflix is very clearly bound for a potentially important top at 292.80 and seems likely to make short work today of the Hidden Pivot’s ‘p’ sibling at 249.28. That number lies just above the 248.85 point B of the pattern, implying the camouflageurs could have a great opportunity to get long on the breakout. To do so, I’d suggest zooming down to the 5-minute chart once 249.28 has been surpassed, and jumping on the first signaled ‘x’ that occurs thereafter.