NIO: Fantastic movement! Now what?

Hello traders and investors! Let’s see how NIO is behaving today! It is doing some fantastic movements, but what to do with it now? There are a few strategies to use here.

First, if you are out, there’s nothing else but wait for a pullback or correction. These movements are normal and healthy, and they will happen eventually. This way, you’ll jump in a safer trade, with a good R/R ratio.

If you are in, there’s absolutely nothing to worry. The volume started to increase again, as the price exploded up, which is very good, and another indicator that the trend is bullish for sure.

But right now, there’s an important question to make: What kind of gap is this? This week we will know the answer, but there are two scenarios:

1 - It is a Runaway Gap: In this case it won’t be filled, and the price will continue go up, as usual.
2 - It is an Exhaustion Gap: Then it will be filled quickly, demonstrating that the trend is starting to get weaker.

In both cases, you are fine. If this is an exhaustion gap, we will see a pullback or correction in the short/mid-term. It is different from a reversal sign!

A pullback to what point? Nio could hit the purple line at $ 16.44 and wouldn't change the major trend.

And you may use this gap as part of an exit strategy. If Nio fills this gap, then just book your profits and to buy it at a better opportunity. A trailing stop at the previous day’s low is also good.

Personally, I think we can afford to wait for a bearish sign in the hourly chart:


As long there’re no descending tops and bottoms around here, the daily chart will continue its movement.

A bearish pivot in the hourly chart is another good exit strategy to use on Nio. This way, you can keep on the trade until you see a clear sell sign that could lead to a pullback in the daily chart.

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