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Two days of rising prices have provided some relief for Netflix stockholders, but the outlook for Netflix’s stock price remains bearish due to ongoing challenges. One of the latest issues comes from South Korea, where the government is proposing that companies like Netflix and Google pay local network fees.
South Korean lawmakers recently introduced legislation that would impose network fees on these companies. Although the legislation is still in its early stages, it is gaining support in parliament, particularly after a hearing revealed that Netflix is not paying the same network fees as similar local companies. A local provider, SK Broadband, is already seeking to collect these fees, leading to a lawsuit from Netflix.
The bearish sentiment around Netflix’s stock persists, largely due to the impact of losing subscribers to competitors globally. Despite this, the stock has seen a modest uptick, rising 0.64% today, adding to Monday’s 4.78% gain after the price found support at the 189.81 level.
The stock’s recent price activity found support at 189.81, a level that previously served as a double top in July and September 2017 and as support in November 2017.
If the bullish momentum continues, the next target for recovery is the 218.46 level. Beyond that, additional resistance levels are at 252.33, corresponding to the highs from November 2018 and September 2019, and at 275.27, aligning with the lows from April and October 2018. If the price reaches the 331.16 resistance level, it would cover the bearish gap, but this move would require the stock to break through 275.27 and 321.59, the low from January 2020.
On the downside, if selling pressure resumes and the price breaks below 189.81, it could lead to a further decline toward 164.62, the low from August 2017. If that level is breached, the next support would be at 147.01, which corresponds to the low seen in July 2017.