Netflix is scheduled to report earnings after the bell Tuesday.
This quarterly release has higher stakes than normal, according to one technician.
"This is where some short-term pain will come in," Todd Gordon, founder of TradingAnalysis.com, said on CNBC's "Trading Nation" on Tuesday. "If we look at kind of the support level right around that $320 level, there is a lot of vulnerability I think on a bad earnings report."
Netflix shares have largely held above $320 support since breaking firmly above that level in May. Weakness in mid-August and last week had its stock move to that support level before breaking higher again.
If shares fall below $320 and even toward $300, Gordon sees a swift move to levels not seen since sell-offs swept through the tech sector in February.
"If we break, I think you do have the opportunity to get down to about the $250 mark. That's where technical support comes in, sourced all the way back to that 2015 uptrend line, so near-term I think it's vulnerable," said Gordon.
Netflix first broke through $250 at the beginning of the year, briefly fell below it in February, and then surged to new highs over the summer. It is currently a 27 percent drop away from $250.
Gina Sanchez, CEO of Chantico Global, sees the biggest threat for Netflix coming from growth worries and higher expenses.
"The vulnerabilities that most people are focusing on is going to be the miss on U.S. subscriber growth. They are still growing globally. However, that global growth is more expensive growth so it just has a lower margin," explained Sanchez on "Trading Nation" on Tuesday.
Netflix currently generates more than half of its revenue in the U.S., though high-growth in international markets has been eating into that share. Annual international sales have surged 160 percent since 2015.
On top of that, "they actually have some pretty significant debt needs, debt financing needs, going into a higher interest rate cycle," said Sanchez. "Are they going to continue to go fuel those massive expenses with debt? ... I think that's what they need to clarify in their earnings report."
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