In this daily bar chart of NIO, below, we can see that prices continued lower after our buy recommendation in March and after getting stopped out prices did in fact rally. Prices made a lower low in early May followed by higher lows late May and again in June. NIO has rallied above the 50-day moving average line which is bottoming. The slope of the 200-day line is negative and intersects around $27.
The On-Balance-Volume (OBV) line shows a rise from March as traders moved from aggressive selling to aggressive buying. The Moving Average Convergence Divergence (MACD) oscillator has crossed above the zero line for an outright buy signal.
In this weekly Japanese candlestick chart of NIO, below, we can see a doji or a hammer bottom in May (hard to see on this chart) followed by bullish confirmation the next week with a white (bullish) real body. The slope of the 40-week moving average line is still negative.
The weekly OBV line shows some improvement from early May and the MACD oscillator has crossed to the upside for a cover shorts buy signal.
In this daily Point and Figure chart of NIO, below, we can see an upside price target of $31.
In this weekly Point and Figure chart of NIO, below, we can see a potential upside price target in the $40 area.
Bottom line strategy: Traders could probe the long side of NIO again risking to $17 again. The $40 area is our price target.
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