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NIO Technical Analysis: Multi-Factor Sell Signals

Shares of NIO Inc (NIO) are trading slightly lower on the day. The stock has run from $2.00 in early 2020 to a high of over $45.00 in by November 2020 before topping out yesterday. The NIO technical analysis is clear, this Chinese electric car maker has topped out and should see a significant sell into year end. The highest downside target is $35.00 with the second downside target near $30.00. Into 2021, the final base could be as low as $20.00/share.

The NIO technical analysis is signaling major institutional distribution over the last few days, coupled with an RSI that as of yesterday was north of 85 prior to its pullback. There is a long term trend in the stock stretching back to the beginning of the run this year. The parallel lines give a great first and second target for the pull back. This can be seen in the stock chart below. In the second chart, there is a classic monthly time count. This cycle factor is epic in its ability to mark tops and bottoms. Being on the monthly, it is likely NIO Inc put in a multi-month, even multi-year high.

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