What happened

After jumping 11% on Wednesday, and almost 38% just since Monday's closing price, shares of Nikola (NASDAQ:NKLA) are giving some of those gains back today. As of 1:55 p.m. EST, shares were down 17.5% on the day. 

Why the wild three-day ride? Several factors are likely contributing. 

So what

On Monday night, President Joe Biden signed a "Buy America" executive order, and highlighted his support for electric vehicles at the same time. Biden specifically said, "The federal government also owns an enormous fleet of vehicles, which we're going to replace with clean electric vehicles made right here in America, by American workers."

Nikola Two and Tre semi trucks

Nikola Two and Tre semi trucks. Image source: Nikola.

Shares of Nikola and other U.S. electric vehicle makers surged on that comment Tuesday. Yesterday, General Motors (NYSE:GM) announced a hydrogen fuel cell supply agreement with Navistar (NYSE:NAV) for semitrucks. Nikola stock jumped yesterday, and it could have been due to support for hydrogen-fueled semitrucks this agreement implies.

Or perhaps it was caught up in the wild short squeeze trading. As of mid-January Nikola had about 35% of its float held short, according to MarketWatch. Today, however, Nikola is giving back those gains. 

Now what

While the GM news may support the relevance of Nikola's plans for hydrogen-fueled semitrucks, it had to be painful for Nikola management. A well-publicized potential agreement between Nikola and GM fizzled in size late last year when Nikola's credibility came into question. 

The new agreement between GM and Navistar certainly creates a strong and established competitor for Nikola's planned vehicles. Investors today may be questioning if there is enough room for both, assuming the technology even emerges as an efficient alternative to battery-electric vehicles. 

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.