Netflix Inc.  (NFLX) - Get Report has been the most volatile stock in the FAANG family. The stock is up 41% year to date, but it's also the deepest FAANG in bear market territory, 36% below its all-time intraday high of $423.20 set on June 21. While most stocks have been hit hard in December, Netflix has been stabilizing since trading as low as $250.00 on Nov. 30.

Netflix believes content is king. For 2019, the streaming video giant has increased its spending budget for fresh content in anticipation that growth in subscribers will continue. Their theory is that more shows increase subscribers as some will sign-up just to see a single series. The more content provided also reduces the numbers of Netflix cancellations.

The Daily Chart for Netflix

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Courtesy of MetaStock Xenith

Netflix began 2018 in a strong uptrend. This came to an end as the stock set its all-time intraday high of $423.20 on June 21. As the second half of the year began a semiannual value level formed at $291.84, which is the horizontal line in the middle of the chart. This level was not tested until Oct. 19 as the stock began its correction and move into bear market territory. The $291.84 level became a pivot and hence a magnet last tested on Dec. 4.

A "death cross" formed on Nov. 19, when the 50-day simple moving average fell below the 200-day simple moving average, indicating lower levels would follow. The Nov. 20 low was $250. The lower horizontal line at $232.30 is my weekly value level.

The Weekly Chart for Netflix

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Courtesy of MetaStock Xenith

The weekly chart for Netflix is negative but oversold with the stock below its five-week modified moving average of $286.87. The 12x3X3 weekly slow stochastic reading is projected to fall to 16.58 this week down from 18.06 on Dec. 14 moving further below the oversold threshold of 20.00. Note that when the stock was trading at its all-time high of $423.20 on June 21 the stochastic reading was above 90.00, indicating that the stock was in an "inflating parabolic bubble," which proved to be an accurate technical warning.

Given these charts and analysis, buy the stock down to its Nov. 30 low of $250.00 in anticipation of a rebound to my semiannual pivot of $291.84. Reduce holdings on strength to the 200-day simple moving average at $335.40.

Disclosure: The author has no positions in any stocks mentioned and no plans to initiate any positions within the next 72 hours.