Swing Trading for Beginners: Leveraging Momentum to Generate 8.14% Returns on NFLX
Swing trading is a strategy that seeks to capitalize on the inherent volatility in stock prices. It aims to capture gains from stocks within a few days to several weeks, based on changes in their momentum. A key to successful swing trading is understanding the indicators that signal the shifts in momentum, and Netflix, Inc. (NFLX) offers a compelling case study for beginners.
On July 03, 2023, the Momentum Indicator for NFLX crossed the threshold into positive territory, potentially signaling a change of pace in the stock's performance. This change of direction in momentum is a key signal for swing traders, as it can indicate the onset of an upward trend. In the context of NFLX, this could present an opportune moment for traders to consider purchasing the stock or acquiring call options, in anticipation of further gains.
The statistical strength of this strategy is also noteworthy. In a retrospective analysis of 86 similar instances where NFLX's Momentum Indicator shifted to positive, the stock price increased in 68 cases. This results in a success rate of 79%, pointing to a substantial likelihood of the stock following a similar trajectory in the aftermath of the latest momentum shift.
These statistics form the foundation for a potential 8.14% return on NFLX for swing traders. By leveraging the Momentum Indicator as an essential part of their trading strategy, they can potentially capitalize on the stock's volatility and short-term price movements, creating significant opportunities for profit.
This strategy reflects the broader concept of technical analysis in swing trading. By carefully studying the stock's past price movements and related technical indicators, such as the Momentum Indicator, traders can develop insights into potential future trends. NFLX serves as a useful example for beginners, illustrating how to leverage these tools to seize profitable trading opportunities.
NFLX broke above its upper Bollinger Band on October 18, 2024. This could be a sign that the stock is set to drop as the stock moves back below the upper band and toward the middle band. You may want to consider selling the stock or exploring put options. The A.I.dvisor looked at 49 similar instances where the stock broke above the upper band. In of the 49 cases the stock fell afterwards. This puts the odds of success at .
The 10-day RSI Indicator for NFLX moved out of overbought territory on October 22, 2024. This could be a bearish sign for the stock. Traders may want to consider selling the stock or buying put options. Tickeron's A.I.dvisor looked at 47 similar instances where the indicator moved out of overbought territory. In of the 47 cases, the stock moved lower in the following days. This puts the odds of a move lower at .
The Stochastic Oscillator has been in the overbought zone for 2 days. Expect a price pull-back in the near future.
Following a 3-day decline, the stock is projected to fall further. Considering past instances where NFLX declined for three days, the price rose further in of 62 cases within the following month. The odds of a continued downward trend are .
The Momentum Indicator moved above the 0 level on October 18, 2024. You may want to consider a long position or call options on NFLX as a result. In of 82 past instances where the momentum indicator moved above 0, the stock continued to climb. The odds of a continued upward trend are .
The Moving Average Convergence Divergence (MACD) for NFLX just turned positive on October 18, 2024. Looking at past instances where NFLX's MACD turned positive, the stock continued to rise in of 49 cases over the following month. The odds of a continued upward trend are .
NFLX moved above its 50-day moving average on October 18, 2024 date and that indicates a change from a downward trend to an upward trend.
Following a 3-day Advance, the price is estimated to grow further. Considering data from situations where NFLX advanced for three days, in of 317 cases, the price rose further within the following month. The odds of a continued upward trend are .
The Aroon Indicator entered an Uptrend today. In of 312 cases where NFLX Aroon's Indicator entered an Uptrend, the price rose further within the following month. The odds of a continued Uptrend are .
The Tickeron Price Growth Rating for this company is (best 1 - 100 worst), indicating outstanding price growth. NFLX’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron SMR rating for this company is (best 1 - 100 worst), indicating very strong sales and a profitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron Profit vs. Risk Rating rating for this company is (best 1 - 100 worst), indicating well-balanced risk and returns. The average Profit vs. Risk Rating rating for the industry is 86, placing this stock slightly better than average.
The Tickeron PE Growth Rating for this company is (best 1 - 100 worst), pointing to consistent earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The Tickeron Valuation Rating of (best 1 - 100 worst) indicates that the company is slightly overvalued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (12.920) is normal, around the industry mean (5.952). P/E Ratio (51.065) is within average values for comparable stocks, (90.982). Projected Growth (PEG Ratio) (1.889) is also within normal values, averaging (2.987). Dividend Yield (0.000) settles around the average of (0.039) among similar stocks. P/S Ratio (8.190) is also within normal values, averaging (30.667).
The average fundamental analysis ratings, where 1 is best and 100 is worst, are as follows
a provider of online movie rental subscription services
Industry MoviesEntertainment