Netflix Will Not Stop at 300

Looking for a long term holding? Or one with some explosive upside? Why not both. Netflix, $NFLX, could be that stock. At near 258 it is quickly approaching the previous high at 304 from July 2011 with only the 88.6% Fibonacci at 276 in the way of a full retracement. But the stock has some other technical factors working for it as well that suggest it could go much higher. As it rises in a series of gaps and partial pullbacks, it is building a set of nested Cup and Handle patterns. I have done a poor job at hand drawing the first one. The thing with these Cup and Handles is that they are creating a set of targets that are quite large. The first one for example would take the stock to 345 and the second to 443. At a full

nflx

retracement a pause in a handle would give a target of 554. The loose Measured moves higher are also point to big moves. The last move of 87 translates to a target of 397 on this move higher. It also has short interest that is over 12% to fuel it on a potential squeeze. No stock is a set it and forget it, but there is great potential here. You will hear about valuations being to high and that may be true. But price pays, not P/E ratio and there is plenty of precedence for stocks with higher than justified P/E ratios. Your money, your choice.

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