NIO: What would take for a Reversal to occur?

2021年3月2日

Hello traders and investors! It’s been a while, but let’s talk about NIO today!

The stock dropped a lot recently, which is not necessarily concerning, as we are talking about a systemic drop, but still, very annoying. The thing is, NIO is doing some reversal signs in the 1h chart.

First, it filled a gap, which was an Exhaustion Gap. We know it was an Exhaustion Gap because: 1 – It was filled quickly; 2 – It appeared just before NIO retests the $ 42.10, which is a support level; 3 – We already have several gaps in the middle of the bearish leg (yellow areas), when this happens, at one point, we’ll have signs of exhaustion, and an Exhaustion Gap usually appears.

Yes, the bear trend is getting weaker, but it didn’t reverse yet. We must see NIO doing higher high/higher low. Yes, we are near a support level, and it didn’t lose the $ 42.10, but we don’t have any higher high. So, the $ 50.40 is the Key Point here, and if NIO defeats it, we may finally see a reversal in the 1h chart.



In the daily chart, we see that NIO reacted very well last week, when it retested the $ 42.10. Until then, the volume was low (under the 21 ma I always like to put in the Volume), and now, when it retested the support level, the volume increased again.

This could indicate that there are people buying NIO, simply because the Risk/Reward ratio makes sense. Yesterday’s earnings report did bring some volatility, but this is not going to affect the mid/long term perspectives for NIO.

Let’s see if NIO will manage to reverse the bearish sentiment around it, and if you liked this analysis, remember to follow me to keep in touch with my updates on NIO and other stocks! And please, support this idea if it helped!

Thank you very much!