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Monday, October 31, 2022 3:14:18 PM
by Melanie Schaffer, Benzinga Editor
October 31, 2022 2:52 PM | 2 min read
https://www.benzinga.com/trading-ideas/long-ideas/22/10/29485799/nikola-stock-surges-following-keystate-partnership-heres-where-a-new-trend-could-form
ZINGER KEY POINTS
- Although Nikola has negated the sideways trading pattern, an uptrend will need to be confirmed with a higher low.
- The spike higher was likely to come because Nikola had developed bullish divergence on the daily chart.
Nikola Corporation NKLA +15.6% was surging about 15% higher on Monday. The sharp rise caused the stock to break up from a sideways pattern under which Nikola had been trading since Oct. 10.
The higher prices came after Nikola announced it has partnered with KeyState Natural Gas Synthesis to create Pennsylvania's first low-carbon hydrogen production value chain.
The two companies plan to enter into a definitive agreement at a later date to expand the hydrogen supply for Nikola's zero-emissions heavy-duty cell electric vehicles (FCEVs).
Read more about the partnership here.
Nikola has been heavily beaten down, having declined about 96% from the June 9, 2020, all-time high of $93.99 and about 76% from the Nov. 1, 2021, 52-week high of $15.56 to trade at around the $3.64 mark as of Monday.
The stock may be in for a larger reversal to the upside, especially if Nikola can confirm a new uptrend over the coming days.
The Nikola Chart: Although Nikola negated its sideways trading pattern by printing a higher high on Monday, the stock hasn’t confirmed a new uptrend with the formation of a higher low.
Over the next few days, bullish traders can watch to see if Nikola prints a bullish reversal candlestick above the $2.84 mark, which could provide a solid entry for those who aren’t already in a position.
- A spike to the upside was the most likely scenario. While Nikola was trading flat in the horizontal pattern, the stock’s relative strength index was making a series of higher lows, which created exaggerated bullish divergence. That divergence has now started to correct as Nikola has trended higher.
- If Nikola closes the trading day near its high-of-day price, the stock will print a bullish Marubozu candlestick, which could indicate higher prices will come again on Tuesday. The second most likely scenario is that Nikola will print an inside bar on Tuesday to consolidate Monday’s sharp spike.
- Bearish traders will want to see big bearish volume come in and drop Nikola back into the sideways range under $3.24, which could indicate Monday’s surge was a bull trap.
- Nikola has resistance above at $3.93 and $4.52 and support below at $3.59 and $3.24.
Recent NKLA News
- Apple Joins OpenAI Board, Logitech President Opts Out of Reelection, and More News • IH Market News • 07/03/2024 10:59:39 AM
- NIKOLA WHOLESALES 72 HYDROGEN FUEL CELL TRUCKS FOR NORTH AMERICAN CUSTOMERS IN Q2 2024, EXCEEDS SALES GUIDANCE • PR Newswire (US) • 07/02/2024 12:05:00 PM
- Nike Stock Drops 14% in Pre-Market; Nokia Acquires Infinera for $2.3 Billion, and More News • IH Market News • 06/28/2024 10:50:25 AM
- Honeywell Acquires CAES Systems for $1.9 Billion, Sarepta Therapeutics Surges 34%, Gilead Continues Gains • IH Market News • 06/21/2024 12:00:38 PM
- Form 424B3 - Prospectus [Rule 424(b)(3)] • Edgar (US Regulatory) • 06/20/2024 12:03:20 PM
- Form 424B3 - Prospectus [Rule 424(b)(3)] • Edgar (US Regulatory) • 06/20/2024 12:03:03 PM
- Form 8-K - Current report • Edgar (US Regulatory) • 06/20/2024 12:01:11 PM
- Form 424B3 - Prospectus [Rule 424(b)(3)] • Edgar (US Regulatory) • 06/06/2024 12:28:05 PM
- Form 424B3 - Prospectus [Rule 424(b)(3)] • Edgar (US Regulatory) • 06/06/2024 12:27:56 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 06/05/2024 10:40:25 PM
- Form DEFA14A - Additional definitive proxy soliciting materials and Rule 14(a)(12) material • Edgar (US Regulatory) • 06/04/2024 09:20:31 PM
- Form 144 - Report of proposed sale of securities • Edgar (US Regulatory) • 06/04/2024 07:51:39 PM
- Form DEFA14A - Additional definitive proxy soliciting materials and Rule 14(a)(12) material • Edgar (US Regulatory) • 05/31/2024 08:45:19 PM
- Form SD - Specialized disclosure report • Edgar (US Regulatory) • 05/31/2024 08:10:29 PM
- Form DEFA14A - Additional definitive proxy soliciting materials and Rule 14(a)(12) material • Edgar (US Regulatory) • 05/29/2024 08:06:55 PM
- Form DEFA14A - Additional definitive proxy soliciting materials and Rule 14(a)(12) material • Edgar (US Regulatory) • 05/23/2024 08:09:11 PM
- NIKOLA AND AiLO LOGISTICS ANNOUNCE ORDER FOR 100 HYDROGEN FUEL CELL ELECTRIC TRUCKS • PR Newswire (US) • 05/21/2024 12:05:00 PM
- Form DEFA14A - Additional definitive proxy soliciting materials and Rule 14(a)(12) material • Edgar (US Regulatory) • 05/20/2024 08:21:35 PM
- Form DEFA14A - Additional definitive proxy soliciting materials and Rule 14(a)(12) material • Edgar (US Regulatory) • 05/17/2024 08:04:59 PM
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- Form DEFA14A - Additional definitive proxy soliciting materials and Rule 14(a)(12) material • Edgar (US Regulatory) • 05/10/2024 08:04:41 PM
- Form ARS/A - Annual Report to Security Holders: [Amend] • Edgar (US Regulatory) • 05/08/2024 08:05:35 PM
- Reddit Rises 15% After First Quarterly Report, Upstart and Twilio Plunge Due to Weak Q2 Forecast, and More in Earnings • IH Market News • 05/08/2024 12:23:27 PM
- NIKOLA EXPANDS HYDROGEN NETWORK WITH INAUGURATION OF SECOND HYLA REFUELING STATION IN SOUTHERN CALIFORNIA • PR Newswire (US) • 05/08/2024 12:05:00 PM
- Form DEFA14A - Additional definitive proxy soliciting materials and Rule 14(a)(12) material • Edgar (US Regulatory) • 05/07/2024 08:54:24 PM
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Mass Megawatts Announces $220,500 Debt Cancellation Agreement to Improve Financing and Sales of a New Product to be Announced on July 11 • MMMW • Jun 28, 2024 7:30 AM