Although Tesla is currently the king and star in the electric car market, there are other companies such as NIO and Xpeng which are attracting interest from investors due to strong rises experienced in the recent months, and positive forecasts indicating growth in the EV sector in China.
NIO recently announced its new ET7 model which, according to experts, is positioned to compete more with BMW or Audi than with Tesla. However, it could also face Apple’s possible electric vehicle, which, according to rumours could be launched in collaboration with Hyundai.
During yesterday’s trading day, NIO set all-time highs at a level nearing 67 dollars per share, and closed the session with increases of 6.74% at 62.70 dollars per share. This strong performance and the growing interest on the part of investors has led JP Morgan to increase the target price of this share from 50 to 75 dollars per share.
This may further reinforce increases in this company in the future, adding to the fact that during the past year 2020 NIO experienced a strong increase of more than 1,100%.
Technically speaking, we can see that the uptrend has gained strength during the last few trading days, after the price was able to overcome its previous resistance level of previous all-time highs on November 24. After this break, this level in red has become the first level of support, the next level being its average of 18 sessions in black.
Although the uptrend is clear, if we look at its oscillators, we can see that the price has a bearish divergence with the MACD indicator and that it is at overbought levels in its stochastic indicator, due to the recent strong rises and the distance it maintains with its support levels, we cannot rule out that it may undergo some correction despite the fact that expectations remain positive.
Source: Admiral Markets MetaTrader 5. CFD NIO daily chart. Data range: from September 10, 2019 to January 12, 2021. Prepared on January 12, 2021 at 10:30 am CET. Keep in mind that past returns do not guarantee future returns.
In 2020, NIO rose by 1112.24%, in 2019 it fell by 36.89% and in 2018 it fell by 8.74%
For its part, Xpeng is also experiencing a wave of good feelings from investors after it was have known various strategic agreements and have doubled the number of sales, thus achieving sustained growth. It currently offers only two car models, but in recent days Xpeng has announced the arrival of a new model that could boost its sales.
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