Can Fisker And Nikola Get A Jump-Start?
Nikola’s stock reached an all-time high of $93.99 back on June 9, 2020, and Fisker’s stock reached its all-time high of $31.96 on March 2. At the time of their highs, traders and investors were excited about the companies’ prospects but the excitement has waned. As of Thursday, Nikola and Fisker are down from their all-time highs by 87% and 56%, respectively.
According to the Nikola and Fisker charts, however, the two electric vehicle makers may be in for a bounce.
The Nikola Chart: Nikola's stock has been trading in a falling wedge since Sept. 8, 2020, putting in lower highs and lower lows for the past eight months. The stock is trading below both the eight-day and 21-day exponential moving averages (EMAs), which is bearish, and is being pushed South by the descending upper trendline of the wedge.
A falling wedge is considered a bullish pattern, however, and Nikola’s stock will meet the apex of the pattern on April 23. If it doesn’t break from it before then, the apex also aligns with Nikola’s next level of support at $10.52, which could provide a good spot for a bounce.
Bulls want to see bullish volume come into the stock and for it to break upwards from the wedge. This would help Nikola’s stock to trade above the eight-day and 21-day EMAs. If it can break above the wedge, it has room to trade up to $18.36 which is the stock’s next resistance level.
Bears want to see the stock continue to be pushed down until it crosses below its next level of support. If Nikola’s stock loses its next support level, it could fall to $9.54, the lowest price Nikola has ever traded at. If Nikola was to lose $9.54, it could free fall as there is no price history below that and no support.
The Fisker Chart: On Thursday morning, Fisker’s stock lost support at $14.32 and couldn’t immediately regain it. Fisker is trading below both the eight-day and 21-day EMAs making consistent lower highs and lower lows on its trek South.
Like Nikola, however, Fisker is trading in a bullish falling wedge pattern with an apex of April 23. The apex also aligns with Fisker’s next support level at $11.87, which could provide a spot for a bounce.
Bulls want to see Fisker’s stock break up from the falling wedge with bull volume for a sustained move North. This would help the stock to regain the eight-day EMA, although it would still be extended from the 21-day EMA. This extension could be bullish because stocks eventually move to meet up with their EMAs.
Bears want to see Fisker’s stock continue to be pushed down by the upper descending trendline of the falling wedge until it loses support at the apex. If it does, the stock could fall to its next support level at $10.95.
NKLA and FSR Price Action: Nikola was trading down 7.6% at $10.85 at publication time. Shares of Fisker were trading down 3.9% at $13.66.
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