Netflix (NFLX) RSI Bearish Divergence Setting Up Major Rever

📈 Summary:
Netflix has rallied +44% in just 60 days, entering a steep, parabolic move. However, technical exhaustion signs are now flashing across multiple indicators — suggesting a potential near-term top may be forming.

🔍 Key Technical Observations:
1. Bearish RSI Divergence

The RSI is making lower highs (~73) while price makes higher highs → classic bearish divergence.

Similar divergences in December and February led to drops of –12% and –18%, respectively.

2. Parabolic Move + Rising Wedge

Price has broken out of an orderly channel and is now moving parabolically, a pattern typically unsustainable.

The current structure resembles a rising wedge, often a reversal formation.

3. Volume Weakness

Volume has been declining throughout the recent push, signaling weak demand behind the rally.

No climactic buying — this raises the risk of a sharp drop if momentum fades.

4. MACD Losing Momentum

MACD histogram has flipped slightly negative.

A potential bearish crossover is brewing.

🧭 Strategy Outlook
🚨 Aggressive traders could look for short opportunities below $1,240, where support may break.
🧠 Options traders might consider a bear call spread once a daily close confirms the wedge breakdown.

📌 Key Levels

Support to watch: $1,240 (break = confirmation)

Next support zone: $1,190–1,155 (EMA cluster)

Critical RSI trigger: break below 65 confirms bearish divergence playing out

🧩 Final Thoughts
The RSI divergence, parabolic structure, and volume behavior all align for a potential pullback. While the trend is still technically intact, risk-reward favors preparing for a reversal, especially with prior divergences leading to significant downside.