Why Nikola Stock Looks Ready To Break Out In The Coming Weeks

BTIG took a bullish stance on Nikola Corp. NKLA Friday. 

Here's a look at the technical levels for the hydrogen vehicle stock.  

Nikola Daily Chart Analysis

• Nikola stock looks to have broken out of what technical traders may call a falling wedge pattern.
• The stock is trading above the 50-day moving average (green) but below the 200-day moving average (blue), indicating the stock is likely facing a period of consolidation.
• The 50-day moving average may hold as an area of support, while the 200-day moving average could be somewhere the stock finds resistance.

Key Nikola Levels To Watch

• The falling wedge pattern is a bullish reversal pattern that occurs when the highs are squeezed between the lows with a steeper slope.
• The stock looks like it may have broken out of the pattern and might see a trend change in the coming weeks.
• If the stock can cross the 200-day moving average and hold above, the stock may be entering more into bullish territory.

What’s Next For Nikola?

Bullish technical traders would like to see the stock continue to build higher lows as well as cross above the 200-day moving average. The may let the stock change trends and start uptrending.

Bearish technical traders would like to see the stock fall back to where it was trading while it was still inside of the falling wedge pattern. A break to the downside of the falling wedge and the stock may see a further downward push.