By Bryan McCormick
A bearish pattern is developing on Netflix's (NASDAQ:NFLX) six-month daily chart. The double-top formation has a potential downside to the $190 area, which would take the stock back to the lows of March.
NFLX has had a wild ride over the last several months: It hit new highs in February, then plunged to the breakout level in March. From there the video-rental company climbed right back to its previous lifetime high and slightly exceeded it. Then the stock reversed course yet again, with a gap down and some fairly serious downside action today.
This zig-zag resembles an "M" shape on the chart below, albeit with the last leg of that formation missing. I have drawn that in as a vertical orange line.
The pattern would be voided if the stock's price finishes today above yesterday's close, near the $240 area. NFLX is down 2.54 percent to $233.10 in afternoon trading.