Pressure from a key technical indicator could be why Netflix shares are falling, according to a chart analyst.

Netflix shares closed down 6.2 percent Wednesday.

Bespoke Investment Group told its clients that Netflix's inability to stay over an important moving average may have contributed to its sharp decline.

"The FAANG trade is getting hit hard today, with Netflix down. … The price chart for Netflix has looked bearish since it broke below its 50-day moving average a few months ago," the firm's co-head of research and investments, Justin Walters, said in a note to clients Wednesday. "The stock recently attempted to re-take its 50-DMA, but with today's decline, it looks like a failed test."

Moving averages aggregate price data over a time period and are used to gauge a security's longer-term trend.

In similar fashion, MKM Partners predicts more downside for the stock based on moving averages.

"The mid-term trend is becoming a concern as the 50 DMA has started to roll over and now must be considered resistance," JC O'Hara, chief market technician at MKM, said in an email. "We believe downward pressure will push Netflix closer to the August lows."

Source: Kimble Charting Solutions

One chart analyst also sees another bearish chart signal for Netflix stock.

There is a "potential double top" on Netflix's weekly chart, Kimble Charting Solutions founder Chris Kimble wrote in an email. The highs "appears to be creating a new falling channel with a series of lower highs and lower lows."

To be sure, Netflix stock's multimonth decline of more than 15 percent from its June high may primarily be a reaction to the company's recent unfavorable fundamentals

On July 17, Netflix shares fell 5.2 percent a day after it reported disappointing second-quarter financial results. The company added 5.15 million memberships during the quarter missing the Wall Street consensus of 6.34 million.

But despite the stock's recent decline Netflix shares have significant cushion so far this year before they underperform the market. Its shares are up 89.4 percent through Tuesday versus the S&P 500's 8.3 percent gain.

— CNBC's Fred Imbert contributed to this report.