Netflix Nears Major Resistance, Short Trade Opportunity

Netflix (NFLX) shares have staged a remarkable advance in 2025, with the streaming giant’s stock price climbing nearly 35% year-to-date. However, this bullish momentum is now approaching a critical technical juncture that warrants caution for investors and presents a compelling opportunity for short-term traders.

The daily chart reveals NFLX has rallied directly into the upper boundary of a well-defined parallel channel that has contained price action since mid-2023. This technical structure, connecting multiple significant pivot points over nearly two years, has consistently proven reliable as both support during pullbacks and resistance during advances. Most notably, the stock is now testing this upper resistance boundary at approximately $1,137, a level that has historically preceded substantial corrections.

What makes this technical setup particularly high-probability is the precise nature of previous reactions at this channel’s upper limit. The two prior tests of this resistance (marked with red indicators on the chart) resulted in immediate rejections and subsequent declines of 15-20%. With price action once again pressing against this established ceiling after an extended rally, the risk/reward profile strongly favors a short position with a potential downside target near the channel midpoint around $975, representing a possible 13-14% move lower from current levels.

For traders looking to capitalize on this technical setup, entering short positions near the current $1,137 level with tight stop protection just above the channel provides an asymmetric trading opportunity with clearly defined risk parameters. While Netflix’s fundamental business remains strong, this chart pattern suggests price has simply run too far too fast and is due for a healthy technical correction within its longer-term uptrend.