Last year, Nikola Corporation (NASDAQ: NKLA), did not have an easy year, due to some bad press. There were rumours that the company is overvalued and that it could not meet the goals and targets, which it set out for itself. This start-up attracted huge attention with the technology it is still developing, which is related to using hydrogen and electric batteries as the main fuel for powering their vehicles. Nikola Corporation is mainly focused on the truck segment, which could be used in the haulage industry. The company is believed to release its battery electric vehicles (BEV) trucks soon, however, the main investor euphoria is around Nikola’s hydrogen driven vehicles. But, given the lack of progress in that area, investors started raising concerns. Recently, news came out that GM (NYSE: GM) and Jaguar Land Rover are investing more into their hydrogen divisions, which could mean that major car manufacturers are approaching the hydrogen topic quite seriously. This also means that in the future, countries may create a better infrastructure for hydrogen vehicles, this way increasing their popularity. This might help Nikola to focus more on the creation of a better hydrogen vehicle technology, which could give the buying-interest a boost to Nikola’s stock. That said, one should still remember that going forward, competition could become an issue for the company, hence why Nikola’s stock could be something to watch only in the near-term future.
The technical picture of NKLA on our 4-hour chart shows that, yesterday, the share price broke through the upper side of it a short-term upwards moving channel, which has been forming from around mid-June. Such a move might have sparked interested among new buyers, which could help the stock drift higher, at least for a while more.
Even if we see NKLA correcting back down, as long as it stays above the upper side of the aforementioned channel, we will continue aiming higher. New buyers might take advantage of the lower price and push it north. That’s when the stock could travel back to the 18.70 barrier, marked by yesterday’s high. If that barrier gets overtaken, this will confirm a forthcoming higher high, potentially setting the stage for a move to the 19.12 obstacle, or even to the 19.51 level, marked by the current highest point of June.
The RSI is currently flat but remains above 50. The MACD continues to point higher, while resting above zero and its trigger line. The two indicators show positive price momentum, which supports the idea of aiming higher, at least for now.
Alternatively, if NKLA drops back below the 17.45 hurdle, marked by the high of June 22nd, that would place the stock back into the previously-discussed upside channel. The share price may then fall further, possibly moving to the 16.86 obstacle, a break of which might clear the path towards the 16.13 level. That level is marked by an intraday swing low of June 21st.
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