Usman Salis
Chinese EV maker NIO is showing renewed strength after an extended downtrend. The stock has pushed above the $7.71 threshold - a level that previously capped rallies - and the two-week chart suggests bullish forces are regaining control, fueling optimism about recovery.
Technical Analysis: Key Levels and Market Structure
According to FibonacciTrading's assessment, bulls are firmly in control with strong follow-through momentum intact.
The chart reveals several important developments:
- Bullish breakthrough above $7.71: Price has cleared this resistance decisively, signaling strong buyer momentum
- Rounded bottom pattern: The long-term curve suggests a base formation since late 2023, setting up for upward continuation
- Rising volume: The recent rally shows increased trading activity, confirming institutional demand
- Solid support zone: The $5.50–$6.00 area provides critical support beneath current levels
Fundamental Drivers Supporting the Rally
Beyond technical strength, several fundamental factors underpin the recovery. China's EV market is stabilizing after a challenging 2023, with government policies and subsidies continuing to drive adoption. Meanwhile, NIO's international expansion efforts offer opportunities to capture market share beyond its home base, helping validate the bullish technical picture.
Outlook for NIO Stock
The next resistance sits near $9.00–$9.50, with a longer-term target around $11.00 if momentum holds. However, a drop below $7.00 could raise questions about rally sustainability, making the $5.50–$6.00 support zone critical for traders to watch.
Usman Salis
