You Ask, We Analyze: Bears Maintain Control Of Nio Stock If Trend Doesn't Change

On Sunday evening, Benzinga asked its followers on Twitter to name a ticker they still haven’t given up on. Benzinga selected one ticker from the replies for technical analysis. 

@yantrades, @marcos_pinel, @shelbs2032 and @mathiasandre01 asked for Nio, Inc -ADR NIO to be charted.

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The Nio Chart: Nio’s stock has been trading in a downtrend since reaching a July 1 high of $55.13. On Sept. 10, the stock made a higher high, and on Sept. 14 it created a bearish double top pattern just above the $39.50 level.

As the trend played out, Nio reached a Sept. 20 low of $24.54 and bounced up to the $36.40 area, which marks another lower high on the daily chart. On Sept. 25 the stock printed a bearish inverted hammer candlestick, which indicates lower prices may be in the cards for the immediate future.

Nio has two gaps above on its chart. The first gap lays between $36.40 and $36.92 and the second higher gap ranges between the $39.41 and $40.53 levels. Gaps on charts fill about 90% of the time, so it is likely Nio’s stock will trade up to fill each of the gaps in the future.

The stock is trading below the eight-day and 21-day exponential moving averages, with the eight-day EMA trending below the 21-day, both of which are bearish indicators. Nio is also trading below the 200-day simple moving average, which indicates overall sentiment in the stock is bearish.

• Bulls will want to watch for a reversal signal for confirmation the downtrend is over. If Nio can pop up above the $36.50 level, the stock would create a higher high, which would indicate a bullish trend change. Nio has resistance above at $36.56 and $39.61.
• Bears want to see big bearish volume come in and drive Nio down to make another lower low below the $34.50 area. Nio has support below at $34.06 and the $30 level.