What's Going On With XPeng Stock?

XPeng Inc. XPEV shares are trading higher Monday following a report indicating the company and Volkswagen established joint project houses to develop EV infrastructure.

The Details:

The companies have established two warehouses located in China for engineers from both parties to work together to advance development of joint technologies. The project houses are aimed at helping the companies begin production of EV architecture in 2026, including the configuration of electronic components, modules, and network within the electric vehicle. 

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The project houses are part of the partnership developed in 2023 to jointly launch two Volkswagen-branded EV models by 2026. The partnership included Volkswagen's purchase of 4.99% of Xpeng for around $700 million.

“From 2026, all electric vehicles of the Volkswagen brand in China will be equipped with this very powerful and efficient architecture,” said Ralf Brandstätter, member of the board of management of Volkswagen AG for China.

Additionally, the People's Bank of China (PBOC) announced that it would cut interest rates on Monday in an effort to stimulate the Chinese economy.

According to data from Benzinga Pro, XPeng shares are trading on above-average volume above the stock’s 50-day moving average of $8.06.

XPEV Stock Prediction 2024:

Equity research analysts on and off Wall Street typically use earnings growth and fundamental research as a form of valuation and forecasting. But many in trading turn to technical analysis as a way to form predictive models for share price trajectory.

Some investors look to trends to help forecast where they believe a stock could trade at a certain point in the future. Looking at XPeng, an investor could make an assessment about a stock's long term prospects using a moving average and trend line. If they believe a stock will remain above the moving average, which many believe is a bullish signal, they can extrapolate that trend into the future using a trend line. For XPeng, the 200-day moving average sits at $10.89, according to Benzinga Pro, which is above the current price of $8.91. For more on charts and trend lines, see a description here.

Traders believe that when a stock is above its moving average, it is a generally bullish signal, and when it crosses below, it is a more negative signal. Investors could use trend lines to make an educated guess about where a stock could trade at a later date if conditions remain stable.

XPEV Price Action: According to Benzinga Pro, XPeng shares are up 6.39% at $8.99 at the time of publication Monday.

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Image: Courtesy of XPeng, Inc.