r/nio
⚡Massive sell-off across the Chinese capital market. Imminent rebound in July
Author blames NIO's drop on macro capital controls, not fundamentals, and predicts an imminent July rebound as HXC RSI hits 19.
- NIO's decline is driven by macro factors and capital controls, not deteriorating company fundamentals.
- NIO is demonstrating exponential growth, contrasting with peers.
- Nasdaq Golden Dragon (HXC) RSI at 19 indicates an imminent technical rebound.
- US crackdown and strict domestic capital controls pose systemic risks to all Chinese equities.
- Government policies are redirecting capital away from public markets into state-backed strategic industries.
¡Follow us 👉 r/NIO⚡. Stop wondering why NIO is falling so much; this has nothing to do with NIO. It's a global phenomenon affecting all Chinese companies due to the US government's increased crackdown on "everything Chinese," but it's primarily a domestic issue. The Chinese government has intensified its protectionist and capital control measures to centralize its financial resources, prevent capital flight, and protect its domestic economy from international volatility. Beijing has pressured brokerage firms in Hong Kong and Singapore to liquidate, within two years, the investment accounts held abroad by mainland Chinese clients. New regulations require strict national security reviews for Chinese companies seeking to invest abroad. The government aims to channel these savings into its own strategic industries (infrastructure, robotics, and renewable energy).
Authorities have strengthened legal penalties against market manipulation, financial fraud, and speculation, including severe limits on algorithmic and quantitative trading. ...
BABA, during the same period that NIO began its corrective cycle, saw its value fall by more than 50%, from $192 to the current $95 per share... With the exception that NIO is showing exponential growth, while BABA experienced a sharp drop in earnings in the last fiscal year (-62%)... In any case, all Chinese technology companies are going through difficulties...
And from July onwards we should see a strong repricing in the quotes.
That's why, unfortunately, NIO's technical chart has deteriorated so much... Something that certainly didn't make sense.
The rebound will come, but it's impossible to say for sure if that will be the light at the end of the tunnel...This goes beyond NIO, and beyond anything one can project in the medium/long term...
The Nasdaq Golden Dragon (HXC) daily RSI is at 19 points... That's an imminent rebound in the making... But, as you can see from the index's progression, its behavior in recent years has been sideways... The HXC tracks the performance of major Chinese companies listed on US markets.