Is NIO stock a good buy?

NIO Limited designs, manufactures, and sells electric vehicles in the People’s Republic of China, Hong Kong, the United States, the United Kingdom, and Germany. The company offers five, six, and seven-seater electric SUVs. It is also involved in the provision of energy and service packages to its users; marketing, design, and technology development activities; manufacture of e-powertrains, battery packs, and components

In the supply and demand technical analysis below we can see two strong imbalances on the weekly timeframe. That means that every single candlestick took a week of time to be formed. We can see how a strong imbalance located at #1 around $275 per share has played out nicely, and a new imbalance is being created around $3.80.

NIO stock analysis

Future of NIO stock

We don’t need to pay attention to NIO’s stock earnings or fundamental analysis, but if you end up feeding your trading plan with fundamental stock analysis make sure it does not prevent you from placing a trade.

The recent earnings call suggests a potential turn with its financial in 2020. It seems that NIO’s service-focused sales strategy will likely be the game-changer in the long term, we are seeing new strong demand imbalances in the process. NIO’s future has turned more and more bullish as these new weekly imbalances have been created. Gross margin improvement and mass adoption of the battery as a service for their cars will help achieve that.

You can view more analysis like this in our stock market analysis today page.

Should I buy NIO stock?

We all know that it is extremely difficult to believe that China as a country would allow the automotive market to be dominated by a foreign brand like american Tesla (NASDAQ:TSLA). The EVE market is a very lucrative market, and has a significant strategic importance to China. NIO will probably have the support of government policies as well to ensure its survival but only if other Chinese brands do not prove to be superior to NIO.

NIO Stock price action analysis

This is the kind of price action technical analysis you will learn in our trading community. You will learn how to locate new supply and demand imbalances and trade without using any indicators, no news, no fundamental analysis, no earnings announcements, no volume or VSA analysis. Just supply and demand imbalances.

Trading supply and demand imbalances is ideal for beginners and those with a full or half time job, you won’t need to stay in front of the computer all day long trying to move price action with your mind. 

NIO Stock Supply and demand imbalances

As supply and demand traders, we do not need to pay attention to the news, fundamentals or any earnings reports. Once a big timeframe imbalance has gained control, earnings do just the opposite and react strongly to those imbalances. Why is it that you see positive earnings and then the underlying stock drops like a rock, or a negative earnings announcement and the stock rallies like a rocket out of control? You are probably missing the fact that there are big imbalances gaining control.

Unless you are doing very short term trading and scalping, you should not worry about fundamentals or earnings announcements on Nio.

You can use these imbalances to plan your trades in lower timeframes. Trading is just waiting for the right trigger points and scenarios to present themselves, this game has got a name and it’s called the waiting game. We need to patiently wait for the correct scenarios and setups to happen and wait for the price to pull back or dip into the price levels we want to trade, in our case these price levels are made of supply and demand imbalances.

You can visit our learn how to trade the markets page to learn more about our supply and demand trading strategy and trading course.

There are several ways of buying stocks and futures. When trading stocks, you can buy shares of the underlying stock or use options strategies to go long or short at these specific supply and demand levels, long calls or long puts or spreads. You can even buy a NIO CFD (contracts for difference) if you are in a country where it’s allowed.

Alfonso Moreno
Alfonso Moreno
Full time trader, expert technical analyst and founder of Set and Forget supply and demand online trading community. Traveler, photographer and adventurer.

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