Usman Salis
NIO stock has been climbing steadily after months of sideways trading. The shares recently broke above important moving averages, putting $7.72 in the spotlight as a potential new support level. Technical indicators suggest the next significant target sits at $8.51, based on Fibonacci projections that align with the current uptrend momentum.
Technical Picture Improves
NIO Inc. (NYSE: NIO) has been showing consistent strength after finding support at its 1-hour 50-day moving average. The stock is now working to turn $7.72—previously a resistance level—into a solid floor. Market analyst Stock Chase notes this flip is essential before the stock can push toward higher Fibonacci targets. Each pullback has been met with buying interest near key retracement levels, creating a pattern of higher lows that suggests buyers are in control.
The chart shows a bullish structure developing since July. Multiple falling wedge breakouts have acted as springboards for upward moves, with the breakout above $7.00 reinforcing bullish sentiment and pushing price into the $7.70–$7.80 range. Fibonacci extensions tell an interesting story: the 1.618 level at $5.66 and the 2.618 level at $7.08 have both been reached. The next logical target sits at the 3.618 extension of $8.51, which lines up with wave 3 projections and has become the level most traders are watching.
The moving average picture supports the bullish case. The 50-period average (green) is trending well above the 200-period (yellow), a crossover pattern typically associated with uptrends. If price can hold above $7.72, it would confirm the strength and reduce the likelihood of a deeper pullback toward $6.86.
Why the Rally Makes Sense
The move higher isn't just about chart patterns. China's electric vehicle market continues to grow, providing solid tailwinds for domestic manufacturers like NIO. Recent delivery figures came in stronger than expected, boosting investor confidence. There's also been renewed interest across the EV sector broadly, with Tesla and Li Auto seeing gains that have lifted sentiment for the entire space.
Usman Salis
