NIO: Inside a dangerous "Trap Zone"!
Hello traders and investors! Let’s see how NIO is doing today!
First, in the 1h chart, we have higher highs/lows, and the price is trading above the 21 ema, a clear trait of a short-term bull trend. In order to keep going up, it must defeat its first challenge, at $ 46.28, which is the next pivot point.
We can say that NIO is inside the famous “Trap Zone”, between the ascending 21 ema and the previous resistance at the black line. The 21 ema is squeezing the price in a tighter area as time passes, and at one point, NIO will be forced to do a breakout. The question is, to what direction?
In the 1h chart an upwards breakout seems more plausible, as we have an open gap (yellow area), and the next target would be the $ 50.40. But we must be aware of the daily chart:
The problem is, the $ 46.28 is not only a pivot point in the 1h chart, but it is near the 21 ema in the daily chart, and the trend is still bearish in this timeframe. If we have enough bearish patterns around this resistance zone, NIO could easily drop again to the $ 38 area.
The volume decreased in the past few days, indicating that the players are waiting for more signals here, before jumping into any conclusion.
For now, we must watch NIO closely and see how it’ll behave after a breakout from this Trap Zone. And remember to follow me to keep in touch with my daily updates and studies on stocks! And if this idea helped you to see something new in this chart, please, support it with your like!
Thank you very much.
First, in the 1h chart, we have higher highs/lows, and the price is trading above the 21 ema, a clear trait of a short-term bull trend. In order to keep going up, it must defeat its first challenge, at $ 46.28, which is the next pivot point.
We can say that NIO is inside the famous “Trap Zone”, between the ascending 21 ema and the previous resistance at the black line. The 21 ema is squeezing the price in a tighter area as time passes, and at one point, NIO will be forced to do a breakout. The question is, to what direction?
In the 1h chart an upwards breakout seems more plausible, as we have an open gap (yellow area), and the next target would be the $ 50.40. But we must be aware of the daily chart:
The problem is, the $ 46.28 is not only a pivot point in the 1h chart, but it is near the 21 ema in the daily chart, and the trend is still bearish in this timeframe. If we have enough bearish patterns around this resistance zone, NIO could easily drop again to the $ 38 area.
The volume decreased in the past few days, indicating that the players are waiting for more signals here, before jumping into any conclusion.
For now, we must watch NIO closely and see how it’ll behave after a breakout from this Trap Zone. And remember to follow me to keep in touch with my daily updates and studies on stocks! And if this idea helped you to see something new in this chart, please, support it with your like!
Thank you very much.
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