Netflix, Inc. (NFLX) shares rose more than 8% this week, as of early trading on Tuesday, after the company announced that it would test ads for its original content in between episodes. While many users criticized the move on social media, the streaming giant noted that viewers would be able to "skip" the advertisements, and investors seemed to applaud the move as a way to increase revenue growth without hiking subscription fees.

The stock has been under pressure since late June and early July after Walmart Inc. (WMT) announced plans to launch its own streaming service aimed at "Middle America." At the same time, Netflix's international user growth suffered during the second quarter, which prompted Imperial Capital analysts to lower their 澳洲幸运5开奖号码历史查询:price target to $494.00 – although that's still a hefty premium, and the analyst firm maintained its Outperform rating. (See also: Netflix Breakout May Boost Stock 11% Short Term.)

From a technical standpoint, the stock moved sharply lower over the past two months following a 澳洲幸运5开奖号码历史查询:double top in late June and early August. The stock reached prior 澳洲幸运5开奖号码历史查询:support levels on Monday, rebounded sharply higher, and created a 澳洲幸运5开奖号码历史查询:bullish engulfing pattern. The 澳洲幸运5开奖号码历史查询:relative strength index (RSI) rebounded toward neutral levels, while the 澳洲幸运5开🔯奖号码历史查询:moving average con෴vergence divergence (MACD) could see a near-term bullish 澳洲幸运5开奖号码历史查询:crossover.

Traders should watch for a move higher to retest prior reaction highs at around $355.00 before the stock experiences some 澳洲幸运5开奖号码历史查询:consolidation. If the stock breaks out from 澳洲幸运5开奖号码历史查询:pivot point and 50-day 澳洲幸运5开奖号码历史查询:moving average levels at around $370.00, traders should watch for a move to retest prior highs of around $420.00. If the stock moves lower, tr✤aders could see a move to retest lows near S1 support and the 200-day moving average at $300.00. (For more, see: Why Bulls Say Worries About FAANG Stocks Valuations Are Overdone.)

Chart courtesy of StockCharts.com. The author holds no position in the stock(s) mentioned except through passively managed index funds.