Why the Charts Say It’s Still Too Soon to Buy This Beaten-Down Mega-Cap Stock

Core Viewpoint - Despite strong subscriber growth and revenue performance, Netflix's stock is underperforming, indicating a disconnect between business fundamentals and market sentiment [1][5]. Subscriber Growth and Revenue - Netflix has surpassed 327 million paid subscribers, adding over 25 million net users in 2025, with Q4 revenue growing 18% year-over-year, exceeding expectations [5]. Stock Performance - The stock is currently trading around $85, down 36% from its 2025 highs, and is significantly below its 200-day moving average, marking the widest margin in over three years [2][3]. Market Sentiment - Investor sentiment is negative, as reflected in the stock's price action, which suggests that the market is not responding positively to Netflix's business performance [4]. M&A Concerns - A major concern for investors is Netflix's proposed $72 billion all-cash bid for Warner Bros. Discovery, which raises fears about potential balance-sheet stress [6]. Technical Analysis - The stock has created a technical gap near $90, identified as a critical resistance level, and until this gap is reclaimed, any price recovery may face significant supply challenges [7]. Oversold Conditions - Although Netflix's stock is currently in an oversold condition, indicated by its position outside the lower Bollinger Band and a deeply oversold RSI, this does not necessarily imply a buying opportunity [8].