Date: 01 Apr 2019

Apple has a net cash position of over US$100 billion on the high end, and yet it is estimated that the company invested only $1 billion last year in content for its new streaming service. In contrast, Netflix’s investment in new content for the previous year is estimated to have been $12 billion.

On the other hand, Netflix has approximately 150 million subscribers, but Apple has over a billion active devices. If Apple succeeds in convincing some of the existing customers of its new subscription service, this could hurt Netflix. If Disney’s planned streaming service is added to the market at the end of the year, this could cost Netflix more customers.

Chart-wise, the market for Netflix was able to break away from its Christmas Eve low at the beginning of the year and rise relatively steeply within a short period. Since the beginning of February, however, the share seems to be moving forward in a kind of extended sideways movement. The market could not substantially break through US$370. On the way up, this mark could represent the first significant structural level. Further obstacles on the way up could be in the US$386 and US$400 areas.

Below, there could be support at US$ 344. If the market breaks through here, the next, more substantial support could be in the US$323 range. If the market does not find support here, the US$305 level could provide support again. If the market breaks through here as well, the picture will cloud over, and a revaluation will be needed.

With Friday’s candle, the market is right between its two smoothing lines, the 38-day and 50-day moving averages, which still show a bullish trend. If these two smoothing lines cross, it could be interpreted as a bearish signal.

 

NFLX.US Daily Chart | Source: ActivTrader

NFLX.US Daily Chart | Source: ActivTrader 

 

Written by Daniel Schuetz, External Analyst.

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