Photo courtesy of Nio.

NIO Inc. (NIO) shares are seeing a nice upward bounce. On a technical level, the stock is signaling a reversal of a recent downtrend. With so many catalysts lined up in the near- to medium-term, it is no wonder the stock is grabbing attention.

Nio On Cathy Wood's Radar? 

Ark Invest's CEO Cathie Wood, a longtime Tesla, Inc. (TSLA) bull, could be warming to the Chinese electric vehicle startup Nio, according to indications from the fund manager. Wood said in an interview with Business Insider in March that she's impressed by China's focus on electric vehicles and also said her team is looking into Chinese EV players, including Nio and XPeng Inc. (XPEV).

The Chinese government could be backing a local winner in the EV industry as an ecosystem builds around China, Wood said. The likely winner in the Chinese EV race could be Nio or XPeng or even Tesla, Wood said, adding that a homebred company is more likely to succeed.

Fund Buying Reignites Rumors

@AFT Alerts, a Twitter handle that tracks institutional buying and selling, tweeted Friday that 1,231,552 shares of Nio were bought at $39.57 for $48.733 million. This set tongues wagging. In reply, excited Twitter users began to speculate the buying may have been done by ARK Invest.

Nio Gains On Analyst Action, Sector-wide Strength

There is no concrete evidence of Wood's Ark Invest scooping up Nio shares. The strength in the stock may have to do with a positive analyst action. CLSA analyst Soobin Park initiated coverage of Nio shares with a Buy rating and $50 price target. The stock is also capitalizing on the broader market strength that has spilled over into the EV sector.

NIO Price Action

Nio shares gained 3.76% Friday, closing at $41.08.