This is despite the positive news flow that has been coming from this NYSE-listed Chinese electric vehicle manufacturer.
Worries concerning stretched valuations and an across-the-board tech sell-off sent the stock reeling to a low of $35.21 on March 8.
Although the stock bounced off this bottom, it never really picked up enough momentum to push convincingly past a long-term resistance around $46.
Bouncing between the low and the high, the stock managed to complete a triple-top formation by mid-April. Given that the formation is a pointer toward a possible rebound, it was expected that Nio would take off from there.
In a subsequent short rally, the stock did go up to $42.62 before reversing course again.
Nio Stock Overlooks Fundamentals: Nio has been reporting stellar monthly deliveries since the start of the year, and in late April, the company reported forecast-beating first-quarter results and guided to fairly robust deliveries for the second quarter.
In China, the company has struck a partnership with Sinopec Shanghai Petrochemical Company Limited (NYSE: SHI) to expand its battery swapping infrastructure.
The company officially announced last week its expansion into Norway and signaled it will explore more overseas markets in the near-to-medium-term.
Market pessimism toward the stock suggests investors are overlooking the fundamental strength of this manufacturer of premium EVs.
If the sell-off continues, key downside support areas to watch for will be around $28.50 and $21.50.
The 14-day RSI, a key momentum indicator, suggests the stock is in oversold territory. If buying sets in to take advantage of the oversold stock, it is likely that the stock will push past the near-term resistance around $35.50. Other key resistance areas are around $39.50 and $44.
Related Link: Nio‘s Battery Swaps Dampen Global Ambitions: Ark Invest Analyst
Photo courtesy of Nio.
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