Saad Ullah
NIO is back on traders' radar as the stock stabilizes after its recent pullback. The setup includes a stop-loss at $5.61, making disciplined risk management key to this trade.
Chart Setup: What the Technicals Show
Technical analyst the Analyst pointed out that NIO might be gearing up for a move toward $9.49, assuming support holds.The chart reveals an Elliott Wave pattern with both upside potential and clear risk parameters. The stock has pulled back to important Fibonacci retracement levels—0.236 at $6.83, 0.382 at $6.36, and 0.5 at $5.98—suggesting the wave 2 correction may be complete. If the current structure plays out, NIO could climb to $8.41 initially, then push toward $9.49. In a more bullish scenario, an extended wave might even reach $11.24. But there's a catch: breaking below $5.61 would flip the script entirely, invalidating the bullish outlook and opening the door to further downside.
Why NIO Could Move Higher
Beyond the charts, there are real-world reasons supporting a potential rally. NIO remains a major force in China's booming EV sector, and government incentives like subsidies and tax breaks continue fueling adoption. Recent delivery numbers have been solid despite broader economic headwinds, showing that demand for NIO's vehicles is holding up. These fundamentals add some weight to the technical case.
Of course, no setup is risk-free. Macroeconomic uncertainty—think high interest rates and slower global growth—could dampen EV demand across the board. Competition is fierce too, with Tesla and BYD constantly pushing for market share. And technically speaking, if NIO dips below $6.00, especially under $5.61, the bullish wave count falls apart and traders should reassess.
Saad Ullah
