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Netflix (NFLX) Just Overtook the 20-Day Moving Average
Netflix (NFLX - Free Report) is looking like an interesting pick from a technical perspective, as the company reached a key level of support. Recently, NFLX crossed above the 20-day moving average, suggesting a short-term bullish trend.
The 20-day simple moving average is a popular investing tool. Traders like this SMA because it offers a look back at a stock's price over a shorter period and helps smooth out price fluctuations. The 20-day can also show more trend reversal signals than longer-term moving averages.
Similar to other SMAs, if a stock's price moves above the 20-day, the trend is considered positive, while price falling below the moving average can signal a downward trend.
NFLX could be on the verge of another rally after moving 9% higher over the last four weeks. Plus, the company is currently a Zacks Rank #2 (Buy) stock.
The bullish case solidifies once investors consider NFLX's positive earnings estimate revisions. No estimate has gone lower in the past two months for the current fiscal year, compared to 10 higher, while the consensus estimate has increased too.
Investors may want to watch NFLX for more gains in the near future given the company's key technical level and positive earnings estimate revisions.