The Nio share price continues to struggle for upside direction even as the price has broken the falling wedge pattern. The Nio share price achieved the breakout following a rating upgrade from Goldman Sachs. But this enthusiasm has since died out after data released on Tuesday revealed that Chinese auto sales fell 19.6% in September year-on-year, as a chip shortage and generalized power cuts in China bite harder.
The fall in Chinese auto sales in September was the fifth straight month of decline. September’s drop is significant, as it is on the cusp of the traditional season of high auto sales dubbed “Golden September, Silver October”.
Chen Shihua, a senior official at the China Association of Automobile Manufacturers (CAMM), expects some constraints to remain for the remainder of the year, even as he sees some improvement for this period.
The Nio share price is marginally up 0.56% as of writing but struggles to generate the kind of demand required to push prices beyond the $40 mark.
The Nio share price broke out of the falling wedge, but lack of upside momentum allowed for a pullback to the broken wedge border and the 35.64 support. The bulls need to enforce authority to get the measured move going, targeting 43.14 as the completion point. This move needs to take out the resistance barriers at 39.33 and 41.31 to attain this completion point.
On the other hand, a decline below 35.64 puts 34.64 under pressure, with 32.50 and 30.68 lining up as potential targets to the south. This move would invalidate the wedge pattern.
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