Netflix (NFLX) - Get Report stock is down about 1.8% in Tuesday's trading after Needham analyst Laura Martin downgraded the streaming major to underperform from hold. 

Netflix has been the worst-performing FAANG stock this year, gaining 11.4%. That lags the S&P 500 and Nasdaq, as well as its next closest FAANG peer Amazon (AMZN) - Get Report, which has returned 16% in 2019.

As for Tuesday’s action, Netflix is under pressure after Needham's Martin said the stock of the Los Gatos, Calif., company would be more attractive near $260, more than $42 below its prior close.

So do the charts point to a 14% decline or will the stock be able to brush off the analyst note? It all hangs on whether critical support holds or fails at this point.

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Trading Netflix Stock

Daily chart of Netflix stock.

Daily chart of Netflix stock.

Near the end of November, Netflix stock was hitting its highest levels since August. But the shares stumbled into December and found that the 50% retracement at $308.61 was acting as resistance.

Tuesday’s analyst call has been the fuel for the latest slip, which puts the stock awfully close to a key technical zone.

At $290 and rising is the 50-day moving average, while the 100-day moving average comes into play just under $294. Further, the 38.2% retracement is at $290.35. 

Finally, up-trend support is one last piece of the technical puzzle. On the chart are two thin blue lines, and depending on how traders draw their trends, Netflix stock either just broke below support or that, too, comes into play near $290.

In other words, the $290 to $294 area is very important for NFLX stock. Should it fail as support, it opens the door to lower prices going forward.

This highlights why Netflix is at such a critical point. 

Below $290 and $270 will be on the table. Just below that is the 23.6% retracement at $267.75. If that fails to support Netflix stock, sub-$260 and the 2019 low at $252.28 is possible.

What if support holds? Then Netflix stock must reclaim the $300 level, followed by the 50% retracement $308.61. Above that and the November highs are on the table, followed by the 200-day moving average.

But it all starts with critical support. See that it holds.