In contrast to its Chinese electric vehicle (EV) counterparts, XPeng (NYSE: XPEV) and Li Auto (NASDAQ: LI), which have experienced significant stock rallies in 2023, Nio (NYSE: NIO) has left its investors wanting more.
The disappointment deepened last week as the company unveiled plans to raise $1 billion through a convertible bond offering, resulting in a staggering $1.5 billion dip in its market capitalization and driving its share price to a three-month low.
This unsettling announcement sent shockwaves through Nio’s investor community as convertible bonds have the potential to dilute existing holdings.
As Nio grapples with this sharp downturn, Finbold glanced at the realm of quantitative analysis, seeking further insights into Nio’s stock market performance using advanced AI algorithms from CoinCodex.
On September 26, the platform’s AI tools set the NIO stock price at $8.25 on October 1, suggesting a potential downside of around 3% from the automaker’s current share price.
From there, CoinCodex predicts NIO’s price to retreat to $10.6 one month from and a significantly more optimistic projection of $34.28 for the 1-year forecast.
NIO technical analysis
For the time being, CoinCodex revealed that investors’ sentiment toward NIO remains bearish, while the fear & greed index shows 39/100, indicating that fear prevails.
In addition, the EV stock witnessed just 11 green days in the past month, with price volatility sitting high at around 10.7% over that period.
For that reason, the AI algorithm suggests now may be “a bad time to buy NIO stock because it’s trading 1.27% above our forecast.”
Meanwhile, after plummeting as much as 18.2% last week, NIO’s shares are now approaching a support level. The price action is now getting close to the wedge support, which is located around the $6.50 mark.
Any dip below $7 will see the price action print a new multi-year low.
On the upside, the stock is facing strong resistance around $10, where the confluence of two moving average (MA) lines – 100-day MA and 200-day MA – is located.
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