This is a complete review of the current situation on NIO lets starts:
1) The price made a new local low since the previous ATH at 67,00. The current Draw Down is -53%, with a time duration of 123 days.
2) Currently, the price is a little bit below a clear support zone at 33,00. From here, we can start working on some possible situations
3) BEARISH SITUATION: If the price keeps falling from current levels, we do not have close support zones; the next level we can observe is 16,56, and finally, the cloned descending channel. We are not interested in shorting the stock; this is an idea of possible demands zone if the bearish trend continues.
4) Let's assume the price is not able to break the support zone, and we have a breakout of the FIRST yellow trendline. If that happens, we will avoid trading in the area between 33 and 46. The reason is that we don't have a clear direction defined in that area. So we want to see a breakout above the previous resistance zone at 46 to start thinking about possible setups.
5) If the price can reach 46 and we observe a small corrective pattern above the resistance zone, we will look for short-term setups between 46 and 57. ONLY if the risk-reward ratio we can observe is higher than 1.7. Otherwise, we will not execute any setup
6) Now we will speak about the perfect trading zone for swing traders or position traders. The best level is above the 2 descending yellow trendlines and the resistance zone at 57. Why there? Because we will be above all the bearish structures with a high probability of a new bullish trend starting. The idea here will be to look for a corrective movement once the breakout happens (like the green circle)
The main goal of this post is to provide relevant information in terms of structures, zones, and trading possibilities to anybody interested in NIO. Remember: Protect your capital, do your own research, and always plan what you want to trade in advance.
Thanks for reading!
1) The price made a new local low since the previous ATH at 67,00. The current Draw Down is -53%, with a time duration of 123 days.
2) Currently, the price is a little bit below a clear support zone at 33,00. From here, we can start working on some possible situations
3) BEARISH SITUATION: If the price keeps falling from current levels, we do not have close support zones; the next level we can observe is 16,56, and finally, the cloned descending channel. We are not interested in shorting the stock; this is an idea of possible demands zone if the bearish trend continues.
4) Let's assume the price is not able to break the support zone, and we have a breakout of the FIRST yellow trendline. If that happens, we will avoid trading in the area between 33 and 46. The reason is that we don't have a clear direction defined in that area. So we want to see a breakout above the previous resistance zone at 46 to start thinking about possible setups.
5) If the price can reach 46 and we observe a small corrective pattern above the resistance zone, we will look for short-term setups between 46 and 57. ONLY if the risk-reward ratio we can observe is higher than 1.7. Otherwise, we will not execute any setup
6) Now we will speak about the perfect trading zone for swing traders or position traders. The best level is above the 2 descending yellow trendlines and the resistance zone at 57. Why there? Because we will be above all the bearish structures with a high probability of a new bullish trend starting. The idea here will be to look for a corrective movement once the breakout happens (like the green circle)
The main goal of this post is to provide relevant information in terms of structures, zones, and trading possibilities to anybody interested in NIO. Remember: Protect your capital, do your own research, and always plan what you want to trade in advance.
Thanks for reading!