With a 292.80 rally target, we’re looking for low-risk entry points along the way. With that in mind, check out the 30-minute chart (inset), which has the potential to generate an opportune impulse leg today. Ideally, it would end just above peak #2 (262.99), followed by a relatively brief pullback like the one shown. You should be ready to zoom down to the 1-minute chart if that occurs, the better to cut entry risk down to size on an ABC pattern of leastmost degree. _______ UPDATE (July 18, 10:18 a.m. EDT)): A pattern developed that was even more opportune than the one I’d sketched, since the point ‘B’ of the A-B impulse leg tiptoed up to the previous day’s high without exceeding it. This would have registered as a double top in the tiny, troubled brains of our competitors, but it was in fact an excellent ‘camo’ set-up. If you took it, you were long 400 shares at 264.42 and exited half of them at 266.25. A third round lot should have been exited in the throes of this morning’s bull-trap opening, since the 270.35 high somewhat exceeded the 269.90 target of our camo pattern. You should therefore be holding a single round lot with a built-in profit of $914 @ 269.90. _______ UPDATE (July 22, 3:05 p.m. EDT): Today’s vicious bull trap popped us out of our remaining 100 shares at 262.58, based on a generous, impulse leg-based stop-loss on the hourly chart. Since our cost basis had been lowered to 260.76 by earlier profit-taking, the gain on paper would have been $192 less commissions. If you had exited on Friday, when the hourly chart first turned impulsively bearish, your gain would have been around $324. NFLX remains an all-but-certain bet to reach the 292.80 target given above, so it’s still a bull trade once the current correction has run its course.
