After Rivian (NASDAQ: RIVN) experienced a major surge in price, it seems that the rough patch in the electric vehicle (EV) sector is now over, and other EV stocks are following its example, including those of Shanghai-based automaker Nio Inc. (NYSE: NIO).
Indeed, thanks to its recent advance that has seen its price grow by 8.07% across the past week (most of it in the last 24 hours), Nio, which has been among the weaker performers across the stock market this year, has managed to reduce its price decline in 2024 to 46.14%.
As a reminder, RIVN stocks skyrocketed earlier after Rivian announced a massive $5 billion investment from Volkswagen (FWB: VOW) as part of a joint venture to create next-generation software-defined vehicle platforms for use in both companies’ future EVs.
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Technical indicators still mixed for NIO stock
However, technical indicators are still on the fence regarding NIO shares, which has demonstrated a continuously declining trend in the medium to long term, reflecting the stock’s declining appeal among investors who have been looking at other stock assets at this time.
Currently, NIO stock resides between the support zone of $4.29-$4.33 and the resistance zone of $4.65-$4.73, formed by a combination of multiple trend lines and important moving averages (MA) in multiple time frames, with a decisive breakout at either of these levels setting the stage for further moves.
At the same time, it is also important to note that Nio stock’s relative strength index (RSI) has started to move upwards from 30, and is currently at 48.07, signaling the exit from the undervalued zone and the possibility of a price increase, while forming a symmetrical triangle pattern on the daily chart.
That said, its current price of $4.62 is below its 20, 100, and 200 simple moving averages (SMA), which is a bearish sign while climbing above the 5 and 10 SMAs, which represents a bullish signal for the near-term but is not enough yet to make any definite NIO stock predictions.
Is NIO stock’s luck shifting?
Meanwhile, the 1-week technical sentiment gauges for Nio stock remain in the ‘sell’ area, although oscillators have pushed in the ‘buy’ zone with two 2 ‘buy’ calls, nine ‘neutral,’ and no ‘sell’ suggestions, according to the most recent data retrieved on June 27.
On the other hand, certain Wall Street analysts are more confident in the price performance of Nio shares in the future, rating them a ‘moderate buy’ and expecting an average price of $6.19 in the next 12 months, which would represent an increase of 33.98% to its current price.
Notably, their optimism could stem from positive Nio news, like record-breaking delivery figures, which saw 20,544 vehicles, including 12,164 electric SUVs and 8,380 electric sedans, delivered in May, a massive 233.8% increase from May 2023, with 66,217 EVs delivered since the year’s turn.
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