To The Moon

My interest was piqued when I came across a post stating that $NIO Inc.(NIO)$ is poised for a rally.

I decided to perform a little digging myself based off NIO’s technical analysis based on available indicators.

Below is the outcome of my research.

Moving Average.

NIO's technical indicators suggest the stock is showing early signs of potential upward momentum, though with mixed signals:

• Current price (as of 14 May 2025) was $4.13, just above its 50-day moving average (ma) of $4.1229. (see below)

• However, it is still below its 200-day ma of $4.14.

Other Technical Indicators.

Momentum Indicators

• RSI was 60.15 and that is considered a neutral to slightly overbought condition, depending on the market context. While not as strongly overbought as an RSI above 70, it can still suggest that an asset's price has been rising rapidly and may be due for a pullback. 

• MACD (0.23): Positive value indicates mild bullish momentum.

• Stochastic %K was 14, below 20 signals oversold conditions.

Price Structure

• Immediate support at $4.09 and resistance at $4.20.

• A break above $4.44 could trigger a 7.8% rally to this first resistance level

Price Projections.

While some analysts project extreme long-term targets up to $32.90, more immediate technical projections suggest:

• Base case: $4.44 resistance level (+7.5% upside).

• Bull case: A confirmed breakout above $4.44 could fuel a +72% surge to $7.08, though this requires stronger volume & market catalysts.

12-Month Forecast.

For immediate 12 months forecast, the different price targets are: (see above)

• High - $8.10.

• Average - $4.86.

• Low - $3.50.

Ceiling - False or Permanent.

The stock currently shows neutral-bullish characteristics but needs to clear the $4.44 hurdle decisively to confirm rally potential.

Traders should monitor volume patterns and earnings announcements (next report due June 5)2 for confirmation signals.

Sales / Delivery in China.

Looking at NIO’s EVs delivery, at first glance it seems impressive that NIO managed to ramp up sales volume for 2025 YTD.

Unfortunately, the chart did not tell the complete story.

NIO began deliveries of its economic brands - ONVO and Firefly EVs (in China) as follows:

Onvo (L60 model):

• NIO started nationwide deliveries of the ONVO L60 in China on 28 Sep 2024.

• ONVO L60 was officially launched on 19 Sep 2024 and deliveries commenced about two weeks later.

Firefly (first model, also called Firefly):

• NIO began deliveries of its Firefly EV in China on 29 Apr 2025.

• The Firefly model was officially launched on 19 Apr 2025, with deliveries starting 10 days later.

What This Means.

Brand “NIO” is the premium range of EVs from NIO, the EV maker.

For FY 2024, NIO’s gross profit margin was about 9.9%.

This was an improvement from its 2023 gross profit margin that fell to just 5.5%, emerging from post Covid, amidst steep discounts in order to maintain demand.

For Onvo & Firefly, their gross profit margins were not released. By inference, it should be much lower than 9.9%.

To mitigate the smaller-than-ideal margin, both Onvo and Firefly sales volume need to be much higher than its current quantum, in order to inject confidence back into the brand.

Onvo’s original CEO has resigned for failure to hit the sales volume KPI.

It remains a challenge for NIO to reach breakeven by end 2025, given the fiercely competition Chinese EV market.

Sidetrack: Li Auto and XPeng.

This is where $Li Auto(LI)$ and $XPeng Inc.(XPEV)$ have been successful at (especially Li Auto) in drumming up demand for their value-for-money EVs, consistently and on a monthly basis.

• These 3 Chinese EV makers debut in the Chinese market, almost simultaneously.

• Yet, only Li Auto is profitable and has been since 2023.

• That year marked LI's first annual profit, with a full-year net income of $11.8 billion yuan (approx. USD1.6–$1.7 billion) - see above

• Although profit has taken a beating (-31%), nonetheless it is still, a commendable performance because of a ‘weak’ Chinese economy with no end insight.

• The war with US (Joe & Donald) did not help either.

After all that has been said and done, still think NIO is on the brink of a rally ? I hope so too because I am sitting on paper losses myself.

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