Mike Khouw says Netflix is heading for a Hollywood ending. That's the headline. A trader named Mike Khouw looked at a stock and predicted it would follow a narrative arc like a movie.
Netflix woes. The stock went down. But the fundamentals remain intact, which means the business still works even though nobody wants to buy it. This is called a buying opportunity by people who already bought it at a higher price.
Khouw thinks the plot is lost but the narrative remains. These are synonyms. He used two different words to say the stock price doesn't match the company value, which is what every single trader says about every single stock they want you to buy.
A Hollywood ending means it goes up. That's the whole prediction. Stock down now, stock up later. He could have said that in four words but then CNBC wouldn't have a segment.
The technical setup involves lines on a chart that look like other lines from other times when the stock went up. Sometimes those lines meant the stock went up. Sometimes they meant it went down. Sometimes they meant nothing. Mike Khouw has identified which kind of line this is by checking which outcome would make him look smart on television.
Retail traders will read this headline and think Mike Khouw knows something they don't. He does. He knows how to get invited back on CNBC. They'll buy Netflix calls on Monday and spend the week refreshing their brokerage app watching time decay eat their premium like a f*cking Pac-Man ghost.
The Hollywood ending they get is the one where the protagonist learns an expensive lesson about listening to traders with two first names.
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