Nikola is 'a broken stock' and could lose another 75%, one strategist says

Ticker Tocker's Steve Kalayjian said: "Looking at Nikola's stock chart. It's a broken stock...It could possibly go to $5."

• Nikola's stock price has been in freefall since a short-seller report accused the company of misleading investors. 
• Steve Kalayjian of Ticker Tocker thinks there could be further pain for the "broken stock" and it could crash to $5, from around $19.50, where it currently trades. 
• The stock received its first sell-rating from Wedbush this week after Nikola CEO Trevor Milton has stepped down. 
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Shares in electric truck maker Nikola have been on a roller-coaster journey this month, ever since a scathing short-seller report complained the company had misled investors and one strategist is predicting the stock could lose another 75% in value.

Steve Kalayjian, chief strategist and co-founder of trading platform Ticker Tocker told Business Insider: "Looking at Nikola's stock chart. It's a broken stock. I would avoid it. It could possibly go to $5, it's really hard to tell where it goes from here."

The company went public in early June, when it hit a whopping $93.99. It has since lost 80% of its value, closing on Friday at $19.46.

"There is nothing from a technical view to support it," Kalayjian added.

Nikola received its first "sell-rating" from Wedbush on Thursday. Analysts led by Dan Ives also cut their  price target for Nikola to $15 from $45. 

Nikola had been in talks with energy firms about potentially forming a partnership to build a network of hydrogen re-fueling stations that could eventually pave the way for the company to roll out hydrogen-powered trucks, but the Wall Street Journal reported on Wednesday that these talks had been put on "hold". 

The stock has shed around half its value since short-seller Hindenburg Research published a report on September 10, citing "extensive evidence" the company misled investors, prompting chief executive Trevor Milton to step down this week. 

Anthony Denier, CEO of online trading platform Webull, thinks Wedbush will the the first in a raft of downgrades from Wall Street analysts.

"There is definitely a herd mentality on Wall Street, and when one firm issues a sell rating, it gives cover to other analysts who might have wanted to make a similar call, but were reluctant to be so bold," he said. "If the news gets worse, I wouldn't be surprised if it goes lower than $15." 

The Securities and Exchange Commission and Department of Justice opened an investigation into Nikola last week.