Netflix (NASDAQ:NFLX) shares experienced unusual options activity on Wednesday. The stock price moved up to $552.98 following the option alert. Sentiment: BULLISH Option Type: TRADE Trade Type: PUT Expiration Date: 2021-07-30 Strike Price: $552.50 Volume: 246 Open Interest: 1 Three Ways Options Activity Is ‘Unusual'
Looks like they're selling before the news too. The day after my post, there was a bearish engulfing candle with even more volume. Looks like it was just filling the gap from last ER before selling into the next one. Bullish trade with Puts, so they sold the $552.50 puts? Yikes...but the buyer of those puts is smiling.
This is the big news, and of course the general population is missing the point. They don't need to try to make AAA Call of Duty-type games. More along the lines of Farmville; free to play with option of paying for amenities. Along the lines of Disney+ having "premium access" movies, Netflix is looking to add extra income on top of their base. Games that allow "in-app" purchases coming to Netflix is a possibility. Also not a bad idea, Netflix has always said they are competing with other companies for individuals' time. They are beyond the streaming wars, they are in the time/attention wars and this involves the whole interwebs.
"Netflix shares crater 20% after company reports it lost subscribers for the first time in more than 10 years" - CNBC Well no shit... how about you drop your prices instead of increasing them every few months.
This has been a brutal beatdown. But I think NFLX will rebound to fill this gap, up to $320+. That's +40% from $225 currently.
Took a year, and in fact went down to $160-170. But one of the big gaps from 2022 has been filled. Through it all, NFLX has held this trend line in logarithmic scale. Looking forward, sounds like Reed Hastings is gone. Haven't heard much from the new CEO.
Netflix announced a new viewership metric, # of views. It's real simple, they take the old metric (# of hours) and divide by the length of the series. Which is better? Well that's the wrong question here... Imo the old metric was great, you want to get people spending a lot of hours on your service (reminder that Netflix is in competition with TikTok and video games, not just Disney+). Especially if you are going to be showing ads (more hours = more ads). Now the new metric, falls short in terms of figuring out how many ad views are being contributed by a show. More views != more ads. HOWEVER, what the new metric does, imo, is reveal that Netflix is going in a new direction. That is why it is not a question of which metric is better. I think we will see Netflix going away from every damn show getting 10 hours to tell a story, and every damn show stretching a 30-minute story into 10 hours. Now that Netflix has a new metric, I think they will start going with shorter series. No more, every mediocre show getting 10 1-hour shows for a season. I think we will start seeing new shows only getting 2 hours to tell a story, and show that they can bring in an audience. So I'm glad they've come up with this new metric, that doesn't give a damn about ads. Because too many mediocre shows were getting 10 hours to draw out boring stories.
It is on the 20-week moving average, just like the major indexes (SPY, QQQ, DIA, IWM). I think we see a bit lower too, just to get back to test the area (SPX~4328) when the VIX broke down in June.
