Keeping Tabs on These 2 Electric Vehicle Giants

Both securities sport impressive year-over-year leads

Digital Content Manager
May 11, 2021 at 1:35 PM
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Electric vehicle maker Tesla Inc (NASDAQ: TSLA) is down 1.6% to trade at $619.20 at last check, after China's auto industry body said the tech name sold 25,845 vehicles in April, down from 35,478 in March. Plus, Tesla is facing regulatory pressure from China, and has halted plans to expand its Shanghai plant amid the chip shortage. Meanwhile, up-and-coming competitor Nio inc (NYSE: NIO) is up 1.4% at $34.81, though a reason for the modest rise is not immediately clear.

TSLA Eyes Short Squeeze

Just yesterday, Tesla stock logged its worst single-day drop since February. The security has taken a step back from its Jan. 25, all-time high of $900.40, and is now falling further below the recently supportive 40-day moving average. The $600 level seems like it could contain today's pullback, however, and longer term TSLA sports a 281% year-over-year lead.

The security may benefit from a short squeeze. Short interest rose 14.4% over last two reporting periods, and the 51.18 million shares sold short now make up for a staggering 28.6% of the stock's available float.

TSLA 40 Day

Sentiment Shift Could Boost NIO

Similarly, NIO has been cooling off from a Jan. 11 record of $66.99. The equity has been trading mostly sideways since early March, struggling with overhead pressure at the $42 mark and the 60-day moving average. Still, Nio stock has added over 833% in the past 12 months.

The options pits currently lean bearish, indicating a shift in sentiment may boost the security. This is per NIO's 50-day put/call volume ratio at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), which sits higher than all but 8% of readings from the past year. This means long puts are being picked at a faster-than-usual clip.

NIO 60 Day

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