NIO - more downside soon? Target 5.50

tommtajlor Updated   
I am following NIO with one eye, now switching to two eye. Even though NIO could have a bright future for the long run (years), I see more downside incoming.
The formed head and shoulder within the symmetrical triangle broke to the downside (breaking also the triangle), and as expected retested the HOS neckline (and the triangle). As expected, it got rejected, also bumping into the 200 SMA (4hr)with a huge rejection, confirming it is still in a strong bear-trend now. We are also way below on the 200day SMA, and also the 200week SMA.
On the weekly, we are loosing momentum, but some upside is expected on the short-term.
I assume (but price actions will tell), this short term uptrend will help to finish the smaller formation on the new Head and Shoulders, which I highlighted with paintbrush in white.
Currently, we are in the consolidation zone, chances are, we are going up a bit to create the top of the right sholder with the target of 9.40-9.60, then going back down to the consolidation zone.
Also, there is a possibility we have a very shallow right shoulder almost formed already, going down directly, I will wait for confirmation.
We are also below the 9day&15 day MA, and also below the 21day EMA. All theese will possibly be huge resistance.

Very short-term : uptrend target - ~9.40
Short-term: downtrend target: ~8.80
Low Mid-term: downtrend target: ~8.00-7.70
High Mid-term: downtrend target: ~7.10
Long-term: downtrend target: ~5.50
Trade active:
Small position (10%) added for short @9.75
The right shoulder has started to form, with a bit of an overshoot (~9.80) and got rejected at that resistance level. Small downturn happened, I do expect some consolidation at around the 9.50 level. I have only added my small position in the overbought territory on the 15min to grant a good entry if we have reached the top. We have to be very cautios in this range:
With the overshoot it gave a bit more momentum that I would have loved to see, meaning:
1) although we have fully closed below the 9day MA (+, resistance), we failed to close below the 15day MA (- support)
2) we gapped too much above the 9.30-9.50 area, which is itself should be consolidation zone (- resistance)
3) with the gap up there is a new gap to be filled below sometime(+), I expect to be closed latest next week.
4) it is possible that we see a formation of a cup and handle, and the right shoulder formation gonna be invalidated (-)

All in all, i will watch closely the price actions in the coming days. Genereally i still do expect the downside, tremendous amount of gaps was left below, down till the 1.50 usd price points. It might happen though that I jumped too soon (hence I added the small position only to have some skin), and that the cup and handle will be in effect.
Trade active:
Mid size sell position added (20%) @9.45 USD
Just as expected, the symmetrical triangle break to the downside on the short timefrime, instantly broke to next support level, dipped below, broadening berish wedge formed, alongside with a head and shoulders pattern.

The wedge broke to the down already. I do expect this week to go down the 8.90 level (with resistances, lower highs- lower lows and some sideways), hitting the downtarget of the wedge, and if no support given, then possibly already test the 8.78 level which is the downtarget of the HOS.

If we reach that ~8.78-8.80 level, then our big HOS is ready.

Room on the RSI is plenty for more short-term downturn.
MACD going nicely bearish, showing more downside
BB has plenty of room to the downside, sitting in the middle, showing downside momentum incoming
Got rejected on the 50day, 21day EMA, 9day SMA, 15day SMA
Way under the 100day MA, and very bearishly under the 180/200 MA.

I am following the price actions closely; altough we failed on the MA's and chart patterns are telling huge downside potential, theese are tools only and not validations. Also, big resistance levels, with big buy pressures are at 9.00; 8.90;8.80 so always set your strategy and manage your risks.
Added some fib levels. Price actions will tell, for me it seems we have possibly already taken out the C subwave top in the overall iv. wave with the top of the head and shoulders at around the ~14usd, and that we are in the way down in the v. bearhish wave down.

I would expect to retest in the short term the 9,15&21 day MA's (possibly we finish the small HOS formation first...), and if we got rejection, I will add my big position as well. I will watch it carefully and dealing with my risk levels.

If in deed the C wave was finished already, and we are in the overall wave down, ideally, we would like to see at least hitting th 1.618 level, however there gonna be a lot of resistance, on being at around the 5usd-ish level (green box therefore). 1.38 fib level could also be accepted as the downtarget, before turning possibly bullish on the long. A nice setup would be the target below the 1.618 (the bottom yellow box), but chances are very slim.

Of course I am not 100% sure, eventually price actions will either support or not this idea. First small confirmation for this longer term idea would be to shoot under the 8.75 usd level.

My stop loss currently is at 9.60 (which making me profit now anyway)
Trade active:
half if big position (~35%) added for short @ 9.42
The HOS failed to be created, We are in a broadening ascending wedge. Extremely huge fight going on currently, buy the dippers try to push up the price above the 9day MA and to resistance, taking over the 15 day EMA. So far the bottom of the wedge was keeping strong.

If bullers keep up with the good work, might happen that we revisit 10.50-11.00 for a retest...
Trade closed: stop reached:
Seemingly we might go higher for now, I cancelled my positions for now.
Lot of buying pressure happening despite the previous technicals, also NIO in fundamentals underdelivered so far, and it is expected to do so at least in the upcoming quarter.
-HOS failed to be created
-We broke the broadening rising wedge(bearish) to the upside due to huge bull pressure
-On the daily we have lost the resistance for the 9day SMA,21 day EMA, 15day SMA, even for the 50 day SMA (that is a big problem)
-RSI turned back up
-MACD not only turned back up but crossed as well creating possibly more upward momentum
-On the weekly we got boost to the upside momentum so far (altough it is monday only)

Some fight currently going on, I have closed my trades so far, with a very minimal loss (<1%). Looking for re-entry later, I need more data.
It is too early to predict precisely, and we have to follow the price action, all in all, I see a big chance we hitting the lower marked circle, and a mid-size chance that we retest 0.618 fib level and around the 100day SMA (around the upper circle), and therefore the top of the bigger broadening wedge.
If theese fails, then a small chance to retest the blue line around the ~10.65-10.75-ish levels.
Gap closed down, I need to see if we break above again on the smaller broadening rising wedge. Currently on the daily we are still in a bullish-like evolvement, need to see if the resistance levels keeps or not, also if we retesting the 9day&15 day MA's. also we would need to drop below the 50day SMA to reconsider short re-entry. On a waiting status currently
So we broke the big wedge to the downside. Right now a small bear flag has formed as well, just below the consolidation zone. Bull was tricked in the past 2 days to grab some liquidity.
The bear flag target has been fulfilled; we stepped into the bottom consolidation zone of the big falling wedge, what people are refferring to. Be aware, the lows of that wedge was tested and rejected so far.

In case we put in a new low comfortably (~7.95 USD), of course the falling wedge as a pattern is taken out and invalid anymore. I will watch the price action; I think we will retest the bottom of the broadening ascending wedge first before breaking down. Time will tell.
We are still in the consoldiation bottom area, forming a small triangle currently. Was taking some breath, soon has to decide if retesting the bottom of the wedge and then breaking down, or breaking down instantly.
with 7.60 the previous low in the big falling wedge was taken out, practicly invalidating. Now we hit a resistance level, possibly the price level trying to recover a bit
New lows are comfortably in, currently just sitting on the trendline. Possibly we will do a correction move up (?) before heading down more.
Some upside correction happened today. 8.07 should act as a heavy resistance.
Small triangle formation has been broken to the downside; currently sitting just on a weekly support level. Lets see if bears can push it through down to ~7 USD.
False breakout so far, descending triangle. Buyers holding so far very well at the resistance (~7.60-ish level), so despite the bearflag/descending trianlge I am 100% certain if it can break down. Please, as always, manage your risks!

15,21 day MA's are so far way above, 50/100 even further away. nearest is the 9day SMA, theese will act as a resistance later.
Next resistance level: 8.10 USD
Next support level if breakdown happens: ~7.15 and then ~6.6 USD
The daily RSI/MACD showing some possibility for an upside correction
The weekly RSI/MACD loosing steam consistently (bearish)
I closed 1/3 rd of the position at 7.38 (downtarget of the broadening ascending wedge, it was reached), ~85% profit taken
So far we jumped back to retest the descending triangle, and also the support level on 7.67.
I was expecting some pullback, a moderate one happened. Overall, so far(as of this moment!!!) there is no evidence we would make a bigger pullback, in fact price was rejected at the triangle line, also got rejected by 50MA (that is a big sign), and most importantly we are still making lower highs and lower lows. Until it is not broken (first the triangle line&50MA), and not making a higher high, I am following the trend.
Also, I have jumped back with my 1/3rd closed position @ 7.70
Trade active:
Jumped back in with the closed 1/3 position, so I am 100% in again.
Trade closed: stop reached:
Closed 100% of the short positions. Might jump back later.
Ascending triangle was not respected, lot of buyers has jumped in at the resistance level; On the smaller timeframes we have now a higher high (higher low not yet). I will wait for further price actions; if I got an approval (higher low + not loosing support on the 9 day MA) I might be jumping in to ride the swing up, till either reversal on the smaller timeframe, or gapfilling above.
So we are getting a pullback from the downtrend (so far this is just considered as a pullback), now at a critical zone.
I have added a "local" fib level for this possible pullback. We are squeezed in between 8.05-8.40, 8.05 being now support, and 8.40 being a huge resistance.
It is a decision point for the smaller time-period (few days-few weeks), we might get a 50% retracement if broken above.

Daily candle itself looking very weak though. I would not be suprised if it gaps up or down to leave this zone (way heavy), or have some form of sideways movement for a short time. 15/21/50 pushing price actions down, 9day MA & 0.768 will try to provide support.

Weekly is also at a decision point what should happen in the upcoming few weeks. (more upside pullback in the overall downtrend, some more sideways, or shooting down more)

Overall I still think a,b,c has finished (wave iv) with the top of the big head and shoulders being the c up correction, and we stepped into the wave v with a way lower target. Question is if we it is a 1-2/1-2-3-4-5, x-y-w/1-2-3-4-5, or just a 1-2-3-4-5 setup. in case it is the first two, we will get a stronger pullback then should go lower (minimum target ~5.50). If it is the 3rd one, then we soon go down breaking below 7.40 as a first sign.

Manage your risks carefully!!!
Short update: we did open a short gap-up, but price got immediately rejected. We are sideways still, being in the "death-zone".
The triangle target was reached.
We are still in the "death-zone" I would say. Seems for me now, this is the wave 4 correction, but it is so far unclear which route it would take, so I have not jumped back in yet.
The weekly showing some upside potential (though being weak still), the daily currently stucked in between the 9 and 21 day MA's. It is a bit undecisive which route to take.
Mid-day update: It is possible an W-X-Y is forming (not 100% percent), just manage your risk levels! If it is indeed evolving, then possibly it is doing a double liquidity grab now!!!
We got the WXY formation eventually breaking so far to the top. I am getting ready for an other round of shorting, because I still think this is just a wave4 up correction. What I am waiting if we get a 5 count up, currently we have only 3 in the A-B-C within the C wave up. Question is how far the 5th goes if we get it. I am planning to get back the game at 0.5 fib level on the chart, starting to scale back in, up until 0.618, with a stop loss at 9.49.

There is still no evidence on the higher scale that the downtrend ended. I think actually some liquidity grab is happening. I can be wrong tough.
On one hand liquidity grab was successfull, on the other hand this dropped impulsively to the downside without retesting 9.11 level . However we tested the 0.382 fib level (wave 4 pullback common target). This move is suspicious for me again. For now we morfed into a bigger WXY, which SEEMINGLY put in 1 count down impulsively, implying we started the first wave of the bigger wave 5 to the downside. I am not buying it though yet. I still think it could revisit first the targeted yellow area, before dropping down more, so it is possible the big WXY forming into a WXYXZ (having at least a double-three), and today move is just the next X, which will be followed soon by a Z up to the yellow area. If we drop below 7.66 that is a first sign as a headsup, that probably the first wave down is forming. But it is early to tell.

Some of you messaged me regarding that this is a falling wedge, and hence it must break out to the top and go upwards. Well, usually bullish formations not neccessarly is working out in a bear trend, especially when we are under the 200. Just be aware.
I still have not jumped back in. this could morph into WXYXZ from the current WXY, and then starting the 5 wave down.

I might possibly jump in for a long, if we have 5 counts down (currently only 3), and ride a bit either the pullback (wave (2) ), with tight stop loss, and then if it wants to add the XZ part, then I ride it up till calculated orange wave 4, and then swinging back to short. Overall I am still bearish
Short update: altought we have not created a new low YET, chances growing this is already the wave (1) down of the bigger yellow 5th wave down of big wave 3. If new lows will be made, possibly there wont be an XZ extension; technicly it could still happen though. I am still overall bearish on NIO, no change on the viewpoint.
So far we only have 3 count down, the downleg is sitting near to the level (~1.23 fib down) where it could still turn around and form the XZ, if one more leg down arriving, then technicly it is invalidated.
We could get the XZ as an extension of the wave orange(4), just be aware! After the 3wave down we got an up, invalidating currently the blue i-ii-iii-iv-v possibility, also the white 1-2-3-4-5 gonna be different with high possibility! I am assuming my former counts are correct; in this case we possibly even could false-break out again from the wedge. This would do an other double liquidity grab, which would couse the most pain&loss to the suspects, so just be aware !!!
3 count up is done, it is possible that the "Z" up has been done, but not yet confirmed. So far we have a small abc down, which eventually could just act as a "connector", so I would not be suprised if it is putting in an other 3 count up in a zigzag, just to triple-trick everyone (buyers and sellers), before heading down, so just be aware!!!!
Z up possibly in, I do expect further drop now, lets see.
Fundamentals, deliveries, order number, income Q vs Q and Y on Y was really bad for NIO. They only gave guidance for this quarter, and tried to avoid the year outlook. Not a good sign for the bulls...
I am revising my price target from 5.50 USD to 5.20 USD
So we started the week with a strong upmovement but got rejected at 8.60. I had to revise the wavecounts alltogether within the orange wave 4 because of past days movements.
Right now is a decision point for 2 scenarios I would say (both bearish), the question is only where will we top out now.
It is possible that we are forming a barrier (widening) triangle and that we just creating now the "Y" count up from the overall WXY. (Which could be prolonged to a WXYXZ or an abcde, worst case to an abcdefg, depending how many bounces we gonna have)

It is also possible that the already topped out, and that the wave 1 down is in, and this bounce up just a part of a wave 2. How will we know? I would say

1st sign, that it is possibly not a wave2: we break above 8.75
for sure: if we break above 8.82.
Then possibly we just having "Y" wave up, which should NOT break above 9.51

I plan to put in an other short if wave "e" extends.
I still on my primary scenario, where this is just a complex orange wave (4). The current pink can extend to ABCDEFG, overall we are in the yellow y wave still, and I believe this is just a liquidity grab again to suck in more buyers to disguise them. Can it be bullish? of course, invalidation point at 9.50, if we hit that level, then probably something else is going on.

I have just put in a short again, stop loss 9.51
Trade active:
small position added (10%)
Trade closed: stop reached
So I have reworked/recounted the possibilities. I am still bearish on NIO short term.
Possibly we are forming a cup and handle, which I expect to fail, will put in a new short at the top handle.

I was very much considering if NIO could have been bottomed, and sure there is one count which could suggest that, but it is less likely, I cannot really count this move up as a wave 1, even though it has many impulsiveness characteristic.

What we possible have is a double embedded diagonal. (double falling wedge who likes formations). We have finished the smaller one with 3-5-3 moves, but that just finished the wave 3, the breakout from the smaller wedge with a complex correction to the upside is the wave 4 which could have finished already, and now we are starting to move down in the 5th wave, which would make sense for me.
I could be wrong of course, but it is a telling sign, we was unable to break above the previous local high, and was unable to fill the gap so far.

Also, it seems for me the wave i (first wave down) could be a leading diagonal, which seemingly will be the handle of the forming cup, then followed by a wave ii to the upside, which should not be able to take out 9.84.

Officially this is invalidating @ 10.22, but if it is taking out 9.84, chances high we wont be able to see 5-6 USD levels.
So far it we are still in the green (iii) wave down, and there is no sign yet that it has finished. Also the forming cup&handle is near to the invalidation point.

For your file: I am not going to update the "trading active/closed/target reached not reached", since I am doing swing trading, jumping in and out based on wavecounts and resistance levels&trendlines. Soon I will put in a hedged buy and will try to ride the (iv) wave up and then will switch to short and then back to long etc etc etc.

Short/mid term I am still bearish on NIO, short-term fundamentals, deliveries, income, margins worsening, also share sales not looking promising at least for the upcoming 1-2 quarter I would say.
I should again re-work the "microcounts" from the marked orange wave 4 top, because seemingly it is something else, and either not following the diagonal, and broke out already to put in the pullback of wave ii, OR it is an expanded diagonal.

Anyway, so far reacted very nicely on the 0.618 level, lets see; if it wants it has still room to go higher before dropping a bigger amount.
Orange wave 4 top reset. If we break above now the previous high, that is the first warning sign, this is probably a 1-2 setup to the upside, and if we break above 10.73 then it is 99% we have bottomed, and this is a 1-2 setup.
This cannot be an abc correction anymore due to made a new high and moving in 3 counts; either we are having a leading diagonal as the wave 4 pullback, which is very near to be maxed out (should not hit above the 0.618 level, or chances are either we are putting in the wave 1 up as a leading diagonal, OR this is a 1-2, 1-2, 1-2 setup forming. Soon a pullback will be imminent, (yellow box), so question is how deep it will pull back.

We also hit the warning level for sell out.
Trade active:
Mid size (30%) Short position added @ 11.05
Now if we turn around immediately and take out the previous height (marked as orange wave 4 top), then discard this idea all together.

I believe though, we made a successfull liquidity grab fooling again the bulls (for the several times now), that would be the most painful for retail traders for sure, hence the belief. We had 2 false breakout from a bigger wedge according to this theory, we put in the wave 4 as big wxy. Either we are forming now a 1-2, 1-2 to the downside, OR it could be a diagonal still.

Even if we are in the bull case, that would mean the wave 1 is in to the upside and a wave 2 bigger pullback is neccessary. Even in that case, price SHOULD pull back to the yellow drawed box.

We have left enormus,several gaps below, even down there at ~7.50, just for the file. Overall we have over ~9-10 unfilled gaps below. Gaps do NOT need to be filled, statistically about 15% will never be filled. But 9-10 gaps??? I think this is just a wave 4 top...

Trade active:
Small short position added (10%) @ 10.72
Trade closed: stop reached
I was wrong, 5th wave up is under creation.
I was getting a few DM why I am still bearish (short term) on NIO. This theory got invalidated, as I wrote, I was wrong. Either my wavecounts is off, or we have not got the last big leg down, which rarely, but can happen. Anyway, I was wrong.

Therefore the bear count not valid anymore. Will I switch to long? Yes, just waiting the current, overall first wave 1 to be finished and to have some pullback. The current wave 1 up (abc structure), either finished OR getting an extension, if getting it, then possibly to the 1.618 levels (or 2.000 but that is less likely for now).
Support area for a later wave 2 pullback is added, BUT it will needed to be adjusted if new high / extension will come.
This is just one scenario.

It is POSSIBLE, that we will kind of form an invers head and shoulder. Be aware, this is just for a " visualisation purposes.:
So we got an extended wave to the upside; seemingly the correction for the a wave down is finished/nearly finished. Typically it react on the 0.382 retracement. I would expect now to have a b wave upside correction, and then a last wave down for the c wave, which would complete the bigger wave 2.
So far we are having a strong move down I have marked as an a wave. The challenge is, it is not looking corrective so far, and it should be (bull case).

We have reached the 0.5 retracement level already withouth putting in a b wave up, so we should have that now. It could also happen we wick down or move down lower withouth putting in a stronger b wave, and then going up without that.

Be aware: we have 5 ways down so far on a big scale, which is by the way quiet bearish. the upside movement is clearly a 3 count move, so I suspect we are moving in a bigger diagonal for now.

Just a warning shot; we moved further down so far without a proper upcorrection, and hit exactly the 0.618 level. Now, it could rally either from here, OR we start to put in the yellow (b) wave upcorrection. The reason I am giving the warning shot is the very bad earnings of NIO. Now, I can easily imagine this whole move up what we have marked as a white wave 1, indeed will be just an abc upcorrection (I know it has doubled over), before dropping down. Warning sign if we drop the 0.786 support level comfortably (so not only by a wick).

Honestly if that is the case, it would have been way-way better (for the bulls) if we drop down previously to that 5.20-5.50 level, because (I hope it is not just an abc upcorrection) honestly if now we are dropping down and as a first sign breaking the 0.786 level, then around next sign if 7.50 is broken, then it gonna go down way lower than 5.20-5.50. Lets see if support levels are kept. So far I am keeping the bullish scenario.

Micro support added, be aware it might not work out, that sell volume is just extreme. Seems instituions getting rid of a huge portion unfortunately. OR it is just a trigger event.
Trade active:
Small position (5%) added for long @ 9.65
So far the microcount is not invalidated. be aware, tehcnicly it is possible we are just dealing with an overshooting b wave top on the smaller timeframe, and that the orange wave 2 is NOT in yet. Small support area therefore is still intact. If the small fib level is comfortably broken then the bigger fib support area comes back in place.

So far, there is no evidence it will break down, and we can contentrate to the upside against 9.69

*Against 9.79, sorry
So far there is no sign price has bottomed, now we are stucked in between a support area, and the 9day MA. Be aware we are also below the 50/52 still.

Also for the bulls, be aware, previously we topped in an abc, suggesting, even if it is going up more, very very likely it is going to be a huge diagonal.

And still, be aware, our orange wavecount is not neccessarly needs to play out; we assumed the yellow (c) wave has bottomed, which can expand further to the downside.

So far price was unable to break out the descending channel, but of course could do that; it is more likely however we are going to revisit the small orange fib area (~10.20 down). As long as 9.79 holds and not breaken comfortably (wick down is okay but cannot break the previous swing low), we have a chance for the orange counts.

Trade active:
Small position 2 added @ 10.15
Just a warning: head and shoulders is ready (for the bears)

I have not added more position; this is not looking convincing now. Sell volume growing, was unable to break back above the 180/200 day MA (we sitting between them), and altough there is reaction on the 0.618 level, it is hesitating very much. On the lower timeframe, the movement looking only as a correction currently, we had a small abc, b wave being a triangle...

I need to see what is happening the upcoming days.

The most worrysome is the volume itself, and that despite option orders executing, sell volume is also big, balancing it out somewhat currently.

Just in case, I have already added to the big orange fib box the 0.887 area (deep pullback scenario).

Small timeframe:

Bigger picture:
I have not added to my positions yet; I am not convinced, primarly because of that huge red rejection candle; which is just a 3 count move again. Best case it can be a "mini-diagonal" to the upside, but it needs to hold now the support areas and not to drop below the previous swing low.

Trade active:
Small position 3 added @ 10.55
Trade active:
Small position 4 added @ 10.12
Short update: NIO is dancing again now a very thin ice. If we now comfortably fall below 10 USD, then I am afraid, chances grow rapidly we are having a huge triangle as the B wave before further drawdown.
Warning: starting to drop too deep, ascending trendline challenged.
We have 5 wave down, but only 3 up.
Warning 2: we went deeper, now chances growing rapidly this is just a triangle as a b wave until further going way deeper.

I have not closed my positions; depending what happenes tomorrow/friday, I will act. I did consider to close almost all (expect my low) my small positions.

So far this is not looking good. Issue is, this seems like as an abcde triangle now, OR we already did have a very short b wave up, and now coming down either as a diagonal, or could morph into an impulse. EXCEPT price not making a new low, turns around now immediately and takes out 10.90, and then 11.05.

Risk starting to grow rapidly, that this is going down way more. So just be aware.
Someone asked for the big picture if this whole runup was only an A wave as it could be.:

Support goes down all the way around ~2.70 USD. IF the wave 2 low is not in yet (we do not know, we try to trade now that huge B wave up, if we get that, which yes, could morph into a big 5 wave up, but as likely diagonal being the last runup only a 3 count up).
Trade active:
Last small position added @ 10.32.
Buy volume has arrived seemingly. We are in fact in a triangle, according to wavecounts it SHOULD break to the upside to finish a 5 wave move up into the red resistance box.

I could be wrong; i am taking this risk
Someone DM'd to ask about the triangle, here it is:
also I have adjusted the wavecounts according to price actions.

Now, be aware, Currently the yellow route is the more probable. Challenge is, it could be counted 4 different ways, question is which one is the 2 most probable?
I would say yellow route, currently forming the b wave as a triangle in an abc, and a c wave up in 5 waves (could be again a diagonal) is expected then.

Second probable (~40%) is the green route. It would also go the upside, but first could drop below the triangle swing low, and MAYBE drop a bit below the previous low, in that case as an undershooting ("overshooting" but to the downside) b wave. This is the issue with b waves, cant really say.

The reason I think its the yellow route:
-already pulled back to the 61.8% retracement
-the turnaround/rejections/support does not seem to nicely respect the first 3 swings
-some more proper volume arriving seemingly now.
-right now the pullback reacting very nicely on the small 61.8 area

Now, I could be wrong of course, so proper risk management is needed! I constantly moving my stop loss levels where I found reasonable, and I just advice you to do the same. I would rather be stopped out a few times, than to take huge losses.

Short after market update:
Triangle massively broke to the downside aftermarket as soon as NIO announced the 1 billion USD note issuance news. Practicly that means dilution on a longer scale. That is extremely bad news, and post hours the market reacting very bearishly.

So, it means we need to throw out the wavecounts. Now, I have a bit of a problem with the counting now, this is clearly opens up a few other possibilities. The challenge is the extreme selloff, that is clearly now an impulsive, motive move. Not a good sign for the bulls.

So far we are dancing around the bigger 0.618 retracement, lets see if that can hold or not. The best now I can come up with is the following:
-we had an (a) wave up
-then we are still forming the (b) wave down, which consist 3 counts agan, a-b-c, the triangle was the full b wave and now coming down in a c wave as an impulse.
-price SHOULD NOT break below 9.58, however it is tricky now, because might morph into an "undershooting" b wave as well, there is the green box what I drawned yesterday, an and it could be still valid.

Now, nobody know so far what will this 1billion usd notes/dilution cause. I just want you guys to be prepared, this move now also can be (bear case) the start of a 5th wave down, which would mean not an abc to the downside, but 5 waves down. IF price turns around now or in the green box, but puts in only 3 waves to the upside.... that would be extremely bearish. Lets see...

Extreme selloff ongoing; that huge sell volume is very frigthening (and remember tomorrow FED meeting, which I would expect big volatility). This 1 billion announcement clearly destroying now NIO. Might be a bit of an overreaction as well.

So what do we have now? So far on the micro level I see no sign of bottoming from this selloff. Some buy volume arriving but so far the sell volume is just extreme.

So far it can be still be an "undershooting" b wave. Price is now showing some, but very weak reaction to the 1:1 level for a possible white c wave target at 9.12-9.15. Not enough yet though.

Next support is 8.85-8.90
Under that 8.70
Under that 8.36-8.40, which is one of our last resort, the 0.786 fib support.
Under that 8.04-8.10, but here chances are shifting back dramatically to the bearish scenario (like 70% chance)

Under that we have 7.70-7.75, here chances are very likely for the bear case (80% at least)

Under that we have 7.25, here chances are 90% at least for the bear case.

Order cancelled:
I reduced the open 5 positions only to the 2 lowest
Sell volume accelerating seemingly; our undershooting possibility for the yellow (b) is getting now challenged heavily.
Undershooting b wave invalidated, sell volume picking up again. Likely morphing into a 5 wave impulse to the downside. Right now it can be several things, impossible to predict with this delution news.
The best I can come up with now due to the price action and the dinamic:
we are still in the orange (c) wave. Can be a diagonal to the downside, but not neccessarly.

Possibly it would look something like this, problem is it would run out of "space", meaning it is very unreliable.

Now, once the 3rd wave to the downside finished, it CAN happen we do not get a 4 and then 5. It would simply mean it is a more complex correction in the (c), possibly then a wxy. Can happen, no guarantee.

The big orange fib support is intact still. Some place is left till the 0.768.
Trade active:
Small position added @ 8.60
Trade active:
Small position added@ 8.42
I think one more low coming to finish off the red circle white wave 3. Currently it is having only 3 waves. Once it is done we should probably get a wave 4 to the upside and then an other swing low in 3 counts as a wave 5.

We have however already maxed out the reliable bullish support level, maybe one more small low would be fine. Remember, if from here we go up straight in 5 counts, and break above 10.30, then likely we not getting the 5th wave down, but it is then just a wxy. Easily possible. I will wait maybe for one more low, make a last entry, and then start to move my stop loss levels.

Reason for that, because chances growing it could break down from here if we fall comfortably below the 0.768 levels, and that we are not getting the huge c wave up as a 5 wave which we are trying to go long for now.

One remark: Several weeks ago it would have been way better (for the long run), if we get that last leg down I was waiting for to hit 5.50-5.20 levels, and then go up, as it would have completed a downcycle with very high probability.

Instead we have now an abc to the upside, and now a very strong pullback...
This suggests, best case scenario from this move forward we can move in a diagonal, full of abc abc abc abc, overlapping, choppy actions likely.

Problem is, it can now morph a lot, and honestly it is likely we gonna get only a c wave up, and then finish off the last round of cycle to the downside. And then it will not stop at 5.50-5.20 likely. More like 2-3 USD.
Pre-market update:
warning, our white wave (5) has only 3 counts. I could "force-count" 5, but that is extremely unlikely, unprobable.

What could it imply?
Either it is morphing onto an ending diagonal, maybe something like the yellow drawing.

Or actually tha white wave (4) is expanding, and not finished yet, orange route. As soon, and then coming down to finish wave (5).

Invalidation above the 0.618 level, AND if we have impulsive 5 waves up.

Trade closed manually:
Highest position reduced by 50%
Upcoming days I will perform re-positioning according to price action.
Seemingly the yellow roughly drawed route playing out so far.

Normally I would expect at least 1 more low. However. Assuming we are still in the "bull" case (meaning, the runup we had was just an a wave (as an abc), or a wave 1 (as an abc); the 0.768 level was already maxed out, not only that, but we popped back up from the 0.887 levels, practicly from the danger zone/death zone. We was able to close just above the 0.768 level.

So it CAN happen (and for now it seems more probable for the bull case) that in the c wave down we do not have 5 waves but morphing into a WXY. In this case we are now putting in the last runup/rundown. This also means, we are now putting in the white wave4, and then, also as an abc a wave 5 could arrive. Why do i say could? Because on the micro level I am very hesitant and I could count 3 different ways this messed up triangle/breakdown(1billion notes issuance news), and there are quiet a few gaps also in after-hours trading, so it can happen that one swing is hidden somewhere. And if it is, AND we are indeed morphed to a WXY in the C wave, and now the 0.886 level is holding, then there should NOT be any new lows coming.

For the bull case:
1) we need to break above now the white descending trendline - 1st , but week sign still
2) we need to take out the white wave 2 high COMFORTABLY (staying above /closing above, so not just a wick) @8.86
3) we need to take out 9.54 and then stay above
4) we need to break above the bigger white ascending trendline
5) all theese needs to happen in 5 motive waves, with 3 pullback

eventually we need to break above then the big red resistance box and take out 14 and then 16.20 USD.

If we are unable to break above 8.83 now:
-we gonna get at least 1 more leg down

If we are unable to break above 9.54, or we break above but fall below and we did not have 5 waves up:
-it is not a WXY, but a huge c wave diagonal at best (heavily unreliable)
-in this case chances are dramatically growing that the whole structure will break down and actually we starting the last big cycle down (the last leg I was previously waiting for and predicted 5.50-5.20 back then), except now it will likely drop deeper... so lets hurray this is not the case.

Also got many DM what am I doing now with my positions:
I closed several with a small loss days ago, and bought myself in in the swing lows, and got rid of meanwhile 50% and 50% on my 2 top position on the swing highs. I will see if I can further rebalance it to the downside more, for now I am holding, and depending on the price action i will start to move my stop loss levels (as I always do).
Repositioning, 3rd position -> 25% closed.

White wave 4 might be in. Remember, it can happen that we go up from here.
So, seems like bulls want it really to be a WXY and go up from here. Lets give it a chance then. I have adjusted the counts.

since white wave 2 is taken out, either it was a smaller 1-2-3-5 (adjusted), or somewhere up previously a 1-2 is hidden, or really just a WXY. Does not really matter, so far we are holding bottom fib support, which really was maxed out.

Be aware, so far I cannot count 5 waves up on the micro level, only 3... it CAN morph to a 5 wave motive wave OR to a leading diagonal, but this is very early.

Next steps which would need to happen:
-hold 8.86, and now take out 9.06, even with just a wick
-evolve into some shape of 5 count motive wave
-do NOT fall below the previous swing low and hold worst case the small red fib support if it wants to pull back i.e. create an inverse head and shoulders/cup and handle, etc...

One possibility for the "bullcase"

Either we are putting in now small yellow wave 4 (green support box should not be comfortably broken), and then coming 2 more zigzag to the upside
We have finished yellow (5) as a diagonal and now pulling back (currently this is more likely due to the huge sell volume)

Either case, 8.10 USD should NOT be comfortably broken to the downside.

Alternatively this is not a WXY (which currently is), but morphing again to a normal 5 count c wave (blue points).
Seeing the price action, I came up with an other possibility for the "bullcase":
if price is holding now the new green support bottom, then it can be the yellow wave(4), and then possibly moving in then an expanding diagonal so far.

Still possible we have finished the yellow (5) as a diagonal, and now pulling back for the correction to the red area.

I left the blou ALT4 / ALT5 how would it rouhgly look like in case it is not a WXY overall.

If green support holding and then shoots up: possibly yellow (5) case
If green support not holding, but red support holding: possibly diagonal case
If neither is holding and breaking down: ALT blue case.

Early warning: with extended hour actions, now we have 5 wave move to the downside from the highs of ~9.35 (yellow wave (3) ).

If we get now 3 counts up in a choppy way, that suggests the moveup is completed as a diagonal best case, and that the green support area will likely get broken, and pulling back deeper to the red area.
Trade active:
Small position added @ 8.49
Trustable max pullback has been reached for a yellow wave (4), perfectly reacted. Now, it is important to hold that swing low, and to have the longest wave as a yellow wave (5), which will likely be an a-b-c (5-3-5).

This is just not to rule out 1 scenario out of 3; all 3 are still in effect!
Trade closed manually:
one my highest position's 50% has been closed off. Rebalancing. Other positions of the lows still there (total 5 position)
I have adjusted a bit the micro-counts. Yellow route still possible, in that case we just put in possible the yellow (A) wave being 5 waves, now coming down in the yellow (B) wave, and then 5 waves going up in a yellow (C) wave to finish off the yellow wave (5).

This is just one possibility. Blue route can still play out as well.

Also be aware in case now we are forming a triangle, I believe we need to switch than back to the bearish scenario which we have left out so far.

Pre-market warning:
We have also now 5 waves down seemingly!!!
I just want to warn everyone, it might happen, that the it wont be a huge WXY and morphing "back" into a 5 waves big down structure, meaning, the ALT (4) and ALT(5) blue markings might play out!!!

I have added micro-support and micro resistances now.

We need to break above COMFORTABLY now 9.10 USD. If we get rejected and the small orange fib support is breaking we are going lower possibly to finish off the blue 5th wave as an abc. This is still the "bullish" case.

But be aware, if 7.60 USD is breaking comfortably, I will switch back to the bear case with a target now not 5.50-5.20 but likely deeper.

And one more remark in case its the blue route: it is still bullish, but then it needs REALLY a strong 5 wave up. if we are only getting a weak abc or 3 swing corrective-ish move then to the upside, then likely:

huge head and shoulders.
Trade active:
Small position added @ 8.29
Both route still possible. For the white wave to be valid, we have to hold the previous swing low, and eventually cut trhough the red resistance box.

Alternatively we are in the blue circle b wave, and then likely we gonna have only 3 waves up instead of 5 and wont be able to go through the resistance box.

Bear case still not presented yet.
White route/case nearly invalidated.
Seemingly putting in 5 waves down, the blue route gaining probabilities prep for deeper drop!
White/yellow route invalidated in its current form.
Now testing the 0.887 levels, so far it is holding, if it is breaking, at least the blue route is confirmed.

If it is holding and able to close above 8 usd, then MAYBE we gonna get a strong C wave up (which if finished, could be a wave 1 to the upside). Chances are very slim though.
0.887 level broken, best case (bull) we are still in the yellow (c) wave down for a big B wave, but getting fragile as well. Sell volume arriving, seemingly wants to accelerate to the downside.

Now, currently reacting on the 1.272 extension (~7.58-7.61) which is also one usual targets for a c wave. Next is 7.26-7.30 USD region. Currently there is no bottoming sign however.

Technicly I could make the case that the 5th, yellow v wave is ready, but could extend further to the downside. Under 7.58 USD however it is getting more probable, that it will expand further, see the blue route.

In that case (blue), IF it is breaking 7.16 with impulsive downside movement, then even the blue route getting very fragile. and breaking the 1.618 extension (~6.60) would indicate, that the previous runup was overall a full abc correction to the upside, and bear case coming online. (3-5 USD target).

For the "bull" case (only short term 6-18month bullish), we need to see now a bottoming structure, start 5 waves up, breaking out to the upside from the white diagonal (broadening falling wedge), then taking out comfortably 8.85 (so not just a wick, but staying above that for while), then taking out comfortable the yellow b wave top at around ~12 USD, and then break out comfortably at 14 USD. Long way to prove dear NIO.

Option market huge support volume currently at 7.50 USD.

We lost all the moving averages support, the 9/21 day heavily rejected price actions. Also fundamentals not looking good for NIO as of now. So if bulls want it to have some chance, now is the time.

Seemingly expanding further downside, one possibility is this:
The bear case is the huge head and shoulders, which meanwhile is ready, with a downtarget of ~3.80 USD.

In that case, our runup to ~16 USD was just either a wave 4 correction or a B wave correction as an abc (because it is clearly not 5 waves up, it is an abc, 3-3-5 formation, only the c wave being 5 waves).

if it was a wave 4, I would debate maybe the lows could be around 5.20-5.50 USD.
If it was a B wave, I would deabate, the lows could be around 2.00-3.50 USD. But too early to tell.

This could just be an overall high, overshooting b wave!!! Wedge is broken to the upside, but now it needs to hold the falling trendline for the yellow route!!!

If it is an overshooting b wave, trendline will be retested and failed to keep, and falling under!!!

Theoretically the yellow/blue route could be in, I could count it two different ways.
As expected previously that runup was a fast liquidity grab with an overshooting fakout.

Now, it is important for the bulls that the price should hold 7.47, and should not drop below it consistently/comfortably. We did have some reaction, BUT be aware this could be just the blue b wave forming, before coming down again.

What needs to happen for the bulls now again:
7.47 holds
We are moving now in 5 waves up, 3 waves pullback
we take out consistently/break above comfortably the red fib resistance box
we break out to the upside on the white descending trendline

I have clearad up the overall picture a bit, removed the unneccessary (anymore) wavecount/subcounts, and also adjusted a bit the boxes based on the previous day's price actions.

early warning: the support level likely wont hold. head and shoulders neckline rejected price action twice. Also, on the micro-level we have 5 waves down with a 3 waves pullback so far. It has to turn around now, take out the previous swing high in order to save the bull case
An other (meanwhile the 4th) rejection at the huge head and shoulder neckline.
So far this looking very-very week. We fall below a major fib support, which constantly now rejecting price action, despite higher buy volumes of a lower timeframe.

Chances are it will heavily break down. Except bulls show up immediately and we start to take out previous swing highs, which there is no sign as of yet.
No sign of bottoming yet, meanwhile we broke the support of the fib box. Some reaction happened on the 1.382 extension (red box below). The "bull" case might be putting in the last wave down, maybe (just maybe) as an ending diagonal, I sketched out the scenario.

My issue is however, it is extremely unreliable now, because falling now under 7.25 would send us on the other hand likely to the 1.618 extension at around 6.64, give or take. This is looking very ugly now.

Bullish case 1:
Either we have now the low in (not reliable so far) as a WXY instead of the i-ii-iii-iv-v, or we had the 5 waves down last wave being truncated and unable to make a new low. This is the white route, but be aware, so far we are having only 3 waves up in the white counts. I have added micro-support for a white wave 4 pullback, which should not be broken comfortably, and definetely cannot interfere now with the white wave i top. If it does, something else is going on (see bullish case 2)

Bullish-like case 2:
The overall low is NOT in yet and we are creating the last wave as an overall diagonal in the yellow (c) wave. What we are putting in right now is the yellow wave 2 to the upside, before further drawdown. It wont be able to hold the green support box therefore. And we cannot really predict the "bottom" as then it is likely shooting under the swinglow of few month ago, likely then as an undershooting b wave. It is extremely unreliable wavecount then.

Be aware, so far we are still under all the meaningful moving averages, which is quiet bearish, except the 9 day SMA at around 7.60, which SHOULD hold now for the white case. We are at structural resistance also at ~8USD level, option markets support currently still sitting at 7.50 USD.

Ultimately for the bull-case we need to break above the descending white trendline (but please read the previous posts).

So we did broke out from the descending channel/wedge, which is a somewhat good sign, now retesting the trendline.

Also now we do have a small 5 waves up clearly on the smaller timescale. I have adjusted the wavecounts a bit, added new resistance/support fib boxes. This was needed because I am still not convinced despite having small 5 waves up, reason being previously we had only a 3 wave move marked as the orange circle wave c (should have been 5, BUT as I mentioned it is possible it was a wxy structure).

What COULD be still the case that we just put in the orange circle B wave high and then it is called an "expanded flat" complex correction, and in fact we just starting now the c wave down with 5 waves. This would be the orange route.

White route suggest we did put in the low already, and we having the first small wave 1 up out of 5, and now putting in the wave 2 pullback. The reason I also keep the yellow route, because now the selloff looking quiet impulsive.

Ultimately for the white route, price CANNOT break comfortably below 7.45 USD, and must hold the fib support (orange area). For it to be more probable, second good sign would be to break the next red fib resistance box.

Dropping still in an impulsive way, also breaking seemingly below the falling trendline. Currently we are also at structural support, and also at the neckline of the big head and shoulder again.

So far the 21 day EMA rejected price action, and the 9day SMA sitting at ~7.68 USD, which SHOULD provide also some kind of support.

The impulsive selloff puts some more weight to the yellow count for now, however 7.45 is still not broken comfortably, so in theory the white route could also play out. Be aware theese two still the bullish scenario, the bearish route (down to 5.50-5.20 as a first target, and then possibly to 2-3 USD give or take is not present on the updates yet.)
We have just reached the 7.45 level, which should hold for a small wave 2 pullback. A wick below it IS fine, as long as the undershoot is NOT sustained and not too deep.

So for however it is not looking finished unfortunately, so we need to be prepared it is indeed the yellow route OR something way more bearish is going on (the bear case as I mentioned in the previously several post before). Also be aware the yellow route is very unreliable and coult easily break further down, because we are just too near to the previous swinglow several month ago.

I have added an other resistance box for a possible yellow wave 2 pullback. If it is indeed the yellow route, price wont be able to break it comfortably.

White route completely invalidated, either we have the yellow route, or the full bear case.
NIO has now a new chance to prove the "bull" scenario (I mean a high huge C wave to the upside, before ultimately likely going down)

So far on the micro level we have only 3 waves up, however this 3rd wave reached and overruned already the 1.618 target, so qualifies as a 3rd wave. I have added back a new white route. Already added a pullback support green box which latest the price should turn around to the upside later again to finish the 5th wave.

Yellow still heavily in play as well !!!. In that count this would just be the wave 2 correction to the upside.

So far the 9 day MA providing support, however we reached a structural resistance, AND also the 21day EMA rejecting price action to the upside so far.

Early warning: support are for a possible white wave(4) is breaking down, the second time we are falling under premarket. If it is instantly turning back now, then has a chance, but already this support-breaking making the white route unreliable as well.
White invalidated again. Market wants this to drop deeper. First target for orange: ~6.80-6.50
Bulls try to morph likely the previous days& weeks price action to a diagonal to the upside. Very fragile count, I have added a new white possibility. Yellow is still in control however so far, until breaking above previous swing high.

White route breaking down again, early warning!!! Bulls just way too weak for now.
Seemingly we are forming a triangle now (could develop to something else), which is not a good sign for the bulls. If its indeed a triangle, then it suggests either a bigger wave 4 is under creation, likely as an overall a wave only out of an abc, OR that the yellow route is morphing into some kind of an ending diagonal. It is preatty much a mess now. Time to add the mid short/mid term bearish scenario, you can find it in blue as a sketch. Be aware it is non-proportional, just an idea.

Funnily it can be counted as a triangle (blue route) OR an unfinished ending diagonal (yellow). The challenge is that now it has retraced 100% to tha previous lows at 7 usd... Yes it can be an "undershooting" big b wave, it is just becoming more and more unreliable unfortunately. Not looking good so far for the bulls for that high white c wave (which would complete the B wave ~22-28 USD).

Now the weekly option mass order already sitting at 6 usd, sell orers at 8 usd