Nio Stock Is Getting Pinched Between Support And Resistance

Nio Inc - ADR NIO shares were trading higher Wednesday after the stock recovered from trading down during premarket hours. Semiconductor shortages are hitting electric vehicle stocks again as Chinese electric vehicle deliveries came up short in August.

Nio was up 0.94% at $39.27 at last check Wednesday.

Nio Daily Chart Analysis

• Shares look to be bouncing off of pattern support in what technical traders call a pennant pattern.
• The price is bouncing off support near the end of the pennant pattern after being condensed between narrowing highs and lows for months. The stock may be ready to see a break in the coming weeks.
• The stock is trading below both the 50-day moving average (green) and the 200-day moving average (blue), indicating recent sentiment in the stock has been bearish.
• Each of these moving averages may hold as a possible area of resistance in the future.
• The Relative Strength Index (RSI) looks to be turning around and now sits at 46. There have been more buyers moving into the stock recently, but there is still more sellers in the stock overall.

What’s Next For Nio?

Bulls would like to see the stock bounce off pattern support and head higher. Bulls would then like to see the stock break above pattern resistance and shoot higher. If this were to happen bulls would then want to see some consolidation.

Bears want to see the stock drop below pattern support and to begin falling more. If the stock can hold below pattern support then the stock could be ready to see another bearish push.

Photo: Courtesy Nio