Technically speaking, the monthly bars show us that since the October dump, every candle, no matter how big the retrace has been, has simply respected the gap created by the dump.
TradingView Chart
And this is significant because that dump was an astonishing 63 percent in two months.
And at the prices of $11 this company is still claimed to be worth $15 billion, even while Evergrande has become a penny stock, the Yuan is in huge trouble, and the entire Chinese economy is on the brink of collapse.
Something I have enlightened to in recent times is that reversal patterns are not reversal patterns unless the market has traded to its true bottom.
This was the problem everyone who was trying to long Tesla, Meta, and Amazon all the way down kept running into.
If you buy too early then you have to sit there in drawdown waiting for 25% miracle candles just to break even for a single day.
And so you always have to ask yourself if the market has traded to its true bottom before you decide to donate your retirement funds to the Party longing a retrace.
On the weekly, the breakout to $16 would be bullish, if $7.5 were the bottom
TradingView Chart
But the problem is that the most meaningful gap on weekly bars was never retraced to after it broke up and it ran away towards $60, and that gap starts at $5.59, almost 50% away from where we traded now.
NIO is not likely to be a long, no matter how nice of a car and how much of a Tesla killer they may arguably make. $NIO Inc.(NIO)$
SOURCE: TRADINGVIEW
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