NIO Plummets 8.15% Amid Sales Slump and Institutional Exodus – What’s Next for the EV Giant?

Summary
• NIO’s stock tumbles 8.15% intraday to $4.51, its lowest since March 2025
• Citigroup trims stake by 6.5%, while July sales drop 37.4% week-over-week
• Bollinger Bands signal $4.16–$5.19 trading range, with RSI at 47.6

NIO’s sharp selloff reflects a perfect storm of deteriorating sales, institutional skepticism, and sector-wide volatility. With the stock trading near its 52-week low of $3.02, investors are grappling with a bearish technical setup and a broader EV sector correction. The $4.45 support level looms large, while Tesla’s 0.57% intraday gain highlights divergent sector dynamics.

Sales Deterioration and Institutional Exodus Trigger NIO’s Sharp Decline
NIO’s 8.15% drop stems from a 37.4% weekly sales plunge in its core brand and a 6.5% stake reduction by Citigroup, its seventh-largest institutional holder. The bank’s Q2 exit from 475,902 shares—valued at $23.43 million—signals waning confidence in NIO’s near-term profitability. Compounding the pressure, China’s EV sector faces regulatory crackdowns on price wars, with NIO’s 23.1% weekly sales drop underscoring its struggle to compete against BYD’s 54,800 registrations and Tesla’s 21.6% weekly sales surge. Analysts now question whether NIO’s $6.90 technical price target remains viable amid intensifying margin compression.

EV Sector Volatility Intensifies as Tesla Gains Momentum
While NIO’s shares crumbled, Tesla’s 0.57% intraday gain highlights divergent sector performance. BYD’s 22.4% year-over-year sales growth and Tesla’s 21.6% weekly sales jump contrast sharply with NIO’s 23.1% sales decline. Regulatory pressures on price wars and Beijing’s crackdown on aggressive discounts have amplified sector-wide uncertainty. NIO’s 8.15% drop mirrors broader EV sector jitters, but its institutional sell-off and weak sales execution position it as a laggard in a market increasingly favoring scale and profitability.

Options and ETF Strategies for NIO’s Volatile Outlook
• RSI: 47.6 (neutral) • MACD: 0.223 (bullish) • Bollinger Bands: $4.16–$5.19 (bearish bias) • 200D MA: $4.27 (below price) • Key Support: $4.45 (30D pivot) • Key Resistance: $4.67 (middle band)

NIO’s technicals suggest a short-term bearish bias, with the $4.45 support level critical for near-term stability. The 47.6 RSI reading indicates oversold conditions, but the MACD’s bearish histogram (-0.023) and Bollinger Bands’ wide range signal heightened volatility. For options traders, two contracts stand out:

• NIO20250822P4.5 (Put):
- Strike: $4.50 • Expiry: 2025-08-22 • IV: 76.05% (high volatility) • Delta: -0.45 (moderate sensitivity) • Theta: -0.002 (slow time decay) • Gamma: 0.66 (high sensitivity to price swings) • Turnover: $40,677 (liquid)
- Payoff at 5% downside (4.28): $0.22 per contract. This put offers asymmetric upside in a sharp decline, leveraging high gamma and IV to amplify returns if NIO breaks below $4.45.

• NIO20250822C4.5 (Call):
- Strike: $4.50 • Expiry: 2025-08-22 • IV: 74.19% • Delta: 0.55 • Theta: -0.019 (rapid decay) • Gamma: 0.68 • Turnover: $111,084
- Payoff at 5% downside: $0.22 per contract. This call’s high gamma and moderate delta make it ideal for a rebound trade if NIO stabilizes near $4.50, though theta decay demands swift execution.

Aggressive bulls may consider NIO20250822C4.5 into a bounce above $4.50, while short-side traders should monitor NIO20250822P4.5 for a breakdown below $4.45.

Backtest NIO Stock Performance
NIO has experienced a total of 634 days with an intraday percentage change of less than -8% since the backtest began on August 20, 2020. The 3-day win rate is 48.58%, the 10-day win rate is 49.05%, and the 30-day win rate is 45.11%. The maximum return during the backtest was 1.31%, which occurred on day 33 after the plunge.

NIO at Critical Juncture – Watch $4.45 Support and Sector Catalysts
NIO’s 8.15% drop has created a pivotal inflection point, with the $4.45 support level acting as a critical psychological barrier. A break below this level could trigger a retest of the 52-week low at $3.02, while a rebound above $4.67 (Bollinger middle band) might reignite the $6.90 technical target. Investors should closely monitor Tesla’s 0.57% intraday gain and sector-wide regulatory developments. For now, the NIO20250822P4.5 put and NIO20250822C4.5 call offer high-gamma, high-IV opportunities to capitalize on the stock’s volatility. Watch for $4.45 breakdown or a sector-wide reversal—either could redefine NIO’s near-term trajectory.