Lots of chatter has been going around lately about Ideanomics (NASDAQ: IDEX) stock, so you know we had to write an article. This type of chatter surrounding a stock like IDEX, is usually due to a massive pump that got rapidly dumped. No need to worry, we analyze the technicals and most likely scenarios for individual stocks. Below we will study the question: Should I Buy Ideanomics Stock?
What is Ideanomics (IDEX)?
Not everyone that checks these articles is aware of the particular stock we are discussing, so it is best to define the company and then check out their technicals/latest news.
First, according to the company website:
Ideanomics (Nasdaq: IDEX) is a global company that facilitates the adoption of commercial electric vehicles and supports next-generation financial services and fintech products.
Our electric vehicle division, Mobile Energy Global (MEG) provides group purchasing discounts on commercial electric vehicles, EV batteries and electricity, as well as financing and charging solutions; we refer to this business model as sales to financing to charging (S2F2C).
Ideanomics Capital provides intelligent and innovative services for the fintech industry. Together, MEG and Ideanomics Capital, provide our global customers and partners with more efficient solutions.
The company is headquartered in New York, NY, with offices in Beijing, Hangzhou, and Qingdao, and operations in the U.S., China, Ukraine, and Malaysia.
Oh, I see…another electric vehicle play.
You should definitely read out articles on the subject, we predicted some big moves.
Lots to unpack here, it appears the company has complex operations, from EV to financial services.
In any case, Ideanomics is essentially a financial services umbrella company that invests in a variety of disruptive technologies for the new economy.
Check out their portfolio of companies:
Here is a brief description of each portfolio item from the company website:
You can (and should) research more about these companies if you are interested in the stock.
Beyond that, if you are a long term investor, subscribe to AFN, because we will be providing updates on the stock more frequently.
We like to be brutally honest and not sugar coat anything on AFN.
Let’s dive into the technicals. The good, the bad and the ugly.
From what we can see here, the chart is showing a steep bull flag with some long term consolidation.
Below is a 3 Month chart of the stock on a daily timeframe:
I have no position in IDEX, which makes it easier to give an honest opinion about the stock technicals and company.
In the above chart, we see the massive spike on IDEX beginning in November 2020.
Essentially, the stock went from less than $1 to about $4.70 in a very short period of time.
We assume the FOMO buying got everyone excited, leading to a major spike in price…and a lot of bagholders.
The stock has not done anything but consolidate since the big pop.
Analysis of the Technicals
You are not doomed if you are holding this stock from the top.
In fact, this is a very common occurrence, particularly for stocks that run up over 100% in a short period of time.
As you can see the RSI (one of the most powerful indicators of price, circled in yellow) indicated a massively overbought level around $4.50.
The RSI is not always correct, but in this case the extreme overbought level proved to be true, and the stock has been getting pounded since.
Unfortunately there are no bullish divergences (when indicators are moving in separation directions) yet.
But as soon as there are, we will update.
To be fair, the analysis of these technicals does not mean anything towards future price, just an analysis of what can be seen on the chart.
The company can come out with a large new order, or something very bullish, and the stock could double overnight.
We have seen it many, many times.
One potentially bullish factor, that I personally always search for, is the GAP.
During the monster run up on IDEX, the overnight gap up left missing information for the trading algorithms (the GAP).
Virtually every single gap on every chart is filled, with few exceptions.
Whenever a gap fills, that *usually* means the algorithm has finally filled out the data that it needs. This can pertain to gaps below or above.
In any case, since the gap has been filled, there is an argument to be made that the stock can begin moving higher again.
Aside from those longer term projects, here is a more recent update on the company.
According to a Yahoo Finance article on a recent press release:
– A total of 151 vehicles delivered in November 2020
– November deliveries also included 13 bus battery systems and 1 charging system
NEW YORK, Dec. 15, 2020 /PRNewswire/ — Ideanomics (NASDAQ: IDEX) (“Ideanomics” or the “Company”) announces its Mobile Energy Global (MEG) division’s sales activities for the month of November. For the period starting November 1, 2020, through November 30, 2020, MEG delivered a total of 151 vehicle units, all of which were units for the taxi/ride-hailing business segment.
A remaining 205 units, invoiced during the period from July through November 2020, are still pending expected delivery. This month’s activities also include the delivery of one charging system and 13 CATL battery systems which are part of an ongoing order for converting diesel-powered buses to battery electric vehicles (BEVs).
Positive company developments/updates are usually bullish.
Ideanomics Stock Prediction
So, now we have somewhat of a fuller picture of the company and the stock chart.
But that does not answer: should I Buy Ideanomics (IDEX) Stock?
To properly address that we must look at the future company plans.
Essentially, it is clear that company management is trying to expand as fast as possible.
This is a smart move, considering the extraordinary industry growth and investments being made into the electric vehicle sector.
You can read more about their updates from the company’s milestone page.
For the most part, our prediction is simple: MILDLY BULLISH
- The gap is filled below
- company has extensive future plans (acquisitions, investments, etc)
- Strong interest in the stock
Again, we do not own this stock and have never traded it.
This makes it easier to see the big picture clearly.
All in all, if you are looking for a quick trade, we would not recommend this stock (unless you have insider info that we do not).
If you are in it for the long run, it may be a good long term hold.
As we stated above, there are plenty of plenty of positive developments by the Ideanomics management team.
It is important to remember, however, that these are long term plans. And they may work out in the long run.
Therefore, if you can hold through the ups and downs, IDEX may be worth you capital, especially considering it is currently trading under $2.
You never know when the next big pop is going to happen!
Gotta be in it to win it.
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