Nikola (NKLA) and General Motors (GM) are still negotiating a manufacturing partnership with a deadline imminent, while two women accused Nikola founder Trevor Milton of sexual assault. Nikola stock fell.
The GM-Nikola is unlikely to close before the end of Wednesday, as originally planned, CNBC reported, citing sources.
On Sept. 8, GM agreed to take a big stake to help the electric-car company build its own Badger pickup truck to take on the upcoming Tesla (TSLA) Cybertruck and other electric trucks.
GM would get $2 billion in newly issued Nikola stock, paid for by in-kind services and and various General Motors parts and components, GM also would engineer and manufacture the battery and fuel-cell versions of Nikola’s Badger truck.
At the time, that $2 billion was seen as giving GM an 11% stake, but Nikola’s market cap has fallen below $7 billion.
Soon after the GM-Nikola deal was announced, a scathing report by short-seller Hindenburg Research accused the electric-truck company of fraud and lies. Milton later announced his resignation as chairman, but GM affirmed it would go forward with the deal.
“We will work with Nikola to close the transaction,” GM said in a statement. “Our overall goal is to put everyone in an EV and accelerate adoption.”
However, GM’s latest statement appeared to mark a shift in tone.
Nikola lost a key bull on Wall Street last week and may also have lost potential partners, after Hindenburg Research accused Nikola’s 38-year-old billionaire founder of misleading investors.
The short seller report has reportedly led to inquiries by the U.S. Securities and Exchange Commission and Department of Justice. Then last Wednesday, sources told the Wall Street Journal that potential partners are ditching the Tesla rival.
Later that week, Wedbush analyst Dan Ives warned the “light has turned from yellow to red” and that the downside risks outweigh any positives for Nikola stock.
He cited execution risk after the departure of Milton and the Tesla Battery Day announcements that could heighten competitive risk. Ives downgraded Nikola stock to an underperform rating from a neutral, slashing the price target to 15 from 45.
Nikola Corporation, formerly VectoIQ Acquisition Corp., specializes in battery-electric and hydrogen trucks and powersports vehicles.
The Company provides zero-emissions transportation and infrastructure solutions.
Its product lineup includes battery-electric and hydrogen-electric class 8 commercial trucks, off-highway vehicles and watercraft.
The Company’s products include Nikola One, Nikola Two, Nikola Tre and Nikola Badger.
Its powersports include Nikola NZT, Nikola Reckless and Nikola water adventure vehicle (WAV).
Overall, the bias in prices is: Downwards.
Note: this chart shows extraordinary price action to the downside.
By the way, prices are vulnerable to a correction towards 33.91.
The projected upper bound is: 28.57.
The projected lower bound is: 6.37.
The projected closing price is: 17.47.
A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 6 white candles and 4 black candles for a net of 2 white candles. During the past 50 bars, there have been 23 white candles and 27 black candles for a net of 4 black candles.
Three black candles occurred in the last three days. Although these candles were not big enough to create three black crows, the steady downward pattern is bearish.
Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 20.7500. This is not an overbought or oversold reading. The last signal was a buy 1 period(s) ago.
Relative Strength Index (RSI)
The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 30.33. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area.
Commodity Channel Index (CCI)
The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is -111.This is an oversold reading. However, a signal isn’t generated until the indicator crosses above -100. The last signal was a buy 8 period(s) ago.
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a sell 12 period(s) ago.
Rex Takasugi – TD Profile
NIKOLA CORPO ORD closed down -1.420 at 17.880. Volume was 100% below average (consolidating) and Bollinger Bands were 0% wider than normal.
Open High Low Close Volume 18.690 18.790 17.510 17.880 57,807
Technical Outlook Short Term: Neutral Intermediate Term: Bearish Long Term: Bearish
Moving Averages: 10-period 50-period 200-period Close: 25.43 35.68 26.38 Volatility: 206 195 182 Volume: 35,852,472 29,136,056 12,281,772
Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.
NIKOLA CORPO ORD is currently 32.2% below its 200-period moving average and is in an downward trend. Volatility is high as compared to the average volatility over the last 10 periods.
Our volume indicators reflect volume flowing into and out of NKLA.O at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bearish on NKLA.O and have had this outlook for the last 8 periods.
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