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The ongoing wars may be heating up, but a name has already cooled down.
Netflix has been down since July and has reached its lowest level since January. The streaming service is also the worst performer in the communications services sector this quarter.
Bill Baruch, President of Blue Line Futures, could continue his momentum.
"As clichéd as it sounds, the trend is to your friend, and the trend is down on Netflix," he told CNBC's "Trading Nation" on Thursday. "Now you have the 50-day moving average crossing below the 200-day moving average, and that's the cross of death."
A death cross is formed when the short-term moving average of an action goes below a longer-term moving average. This is a technically bearish signal that indicates a tendency to fast deceleration.
Netflix dropped nearly 12 percent in August, and Baruch said the company was still struggling to recover.
"It seems like it's cheaper to go here – in fact, if you really back away, I could not, at this point, become optimistic about Netflix until it's over." closes above a trend line and previous highs at $ 380, "said Baruch.
Netflix traded for the last time above $ 380 in mid-July. The stock should gather close to 30% to find this level.
While Netflix actions are buffering, another name fits into the streaming industry. Disney will be rolling out its Disney + streaming service on November 12 for $ 6.99 per month.
A new study by UBS revealed that the number of US customers intending to subscribe to the new streaming service exceeds the company's original goals. Once they have registered, 57% of customers plan to cancel another streaming service, according to the investment bank.
Disney has grown more than 26% this year, compared to the S & P 500 index, which grew by almost 17%, and Baruch said the positive performance of Disney could continue.
"I love Disney, Disney has set records this year, and the last time I've checked, it's a very good thing." There's an escape that's happened and an increased gap.There is a floor just below this hatch, about $ 130, so In the end, I like that Disney is over $ 130. It has a little work to do to overtake the moving average of 50 days, for the band to be really optimistic, but overall, I like Disney. "
Gina Sanchez, CEO of Chantico Global, says that Disney and Netflix can coexist, but that it still has work to do before moving forward.
"I think it's not necessary that it be one or the other.I think the magic number on which everyone lands is 3. Most people are going to agree to subscribe to at least 3 of them, so Netflix will not leave, but you have to look at the issue in terms of potential growth, and that's where the problem lies, "Sanchez said.
The Netflix subscription price suggests to Sanchez that his explosive growth is behind all this.
"You're looking at the fact that they've already pretty well penetrated the US market, so the growth of their subscribers has to slow down, and I think they're going to have a hard time doing that, besides the fact that 39 They spend Their estimated expenses for 2019 will rise to $ 12 billion, for the costs of acquisition and development, and now to $ 15 billion, which is not a good trend if the number of subscribers is down and the cost of acquisition increases. "Sanchez said.
Analysts expect a slowdown in their turnover, which is expected to reach 31 percent in the third quarter, up from 34 percent in the same period a year earlier.
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