For many months, the share price of the Chinese automaker NIO has been moving within a downward channel (shown in red), driven by the company’s ongoing struggle to achieve profitability.

From a technical analysis perspective, this week has provided a discouraging signal for investors – the 4.2 level, which acted as support in June and July before being broken in early August, has now been tested:
→ On the 19th, the price rose on a narrow candle (a sign of buyer uncertainty);
→ On the 20th, the price fell on a wide candle (a sign of seller confidence);
→ This suggests that the 4.2 level has likely switched from support to resistance.

This opens the door for the price to move towards the year’s low, around the 3.650 level.

From a fundamental perspective, NIO investors have reasons for optimism:
→ For the first time in the company’s history, monthly vehicle deliveries have remained above 20,000 units;
→ NIO, which positions itself as a premium brand, plans to launch a budget sub-brand called ONVO, which will offer more affordable vehicles – according to Seeking Alpha, the first L60 model cars could be sold as early as September, with 60,000 pre-orders already placed (indicating strong demand).
→ The company is optimistic about 2025.

NIO’s Q2 earnings report, due on 24 September, could be a turning point for the stock, which currently shows signs of weakness.

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