BYD part: Still a lot of sand in the gear!

The electric car market is currently facing a lot of headwinds. In many areas, subsidies for the purchase of electric vehicles have expired. And this at a time when high inflation and the economic environment are already putting pressure on demand. As a result, manufacturers offer huge discounts to make cars attractive to customers.

Price wars cause margins to evaporate and thus higher valuations. So it’s no surprise that investors in Tesla & Co. they press the sell button. According to a report from industry magazine Electrec, the American e-car pioneer is now planning to cut 10 percent of its jobs. Stock traders see this as another sign of a slowdown in the market for electric vehicles.

BYD sales decline in Q1

Things are not going well for China’s market leader BYD either. After a drop in sales in the first quarter, the company was recently forced to return its title of largest EV seller to Tesla. In addition, the slow growth of electric vehicle sales in China is subject to sentiment.

To die Share in BYD started this year weakly, but managed a reversal in February near 2022 lows of 161.7/165 HKD. Since then, rescue efforts have been ongoing, although they have not come without obstacles. In late March/early April, the HKD 200 mark and the 50-day line (SMA50) proved to be important supports.

BYD stock chart

What’s next for BYD stock?

The chart picture would be much brighter if the medium-term downtrend since mid-June could be broken. The trend line is currently in the HKD 246.80 area.

On the other hand, a break of the 50-day moving average and a slide below the HKD 200 mark would clearly look cheap.