14/5/25 Bulls Need More Follow-through Buying FCPO

1. Tuesday's candlestick (May 13) was a bull doji closing slightly below the middle of its range with prominent tails above and below.
   
2. In our previous report, we said the market may gap up early. Traders would see if the bulls could create a follow-through bull bar closing near its high, or if the market would trade higher, but the candlestick closes with a long tail above or a bear body instead.
   
3. The market gapped higher, followed by an intraday pullback, then traded off the day's low to close with a small bull body. The bulls got some follow-through buying, although not as strong as they hoped, yet.
   
4. The bears see the current move as a pullback.
   
5. They want it to stall around the 20-day EMA (around 3950), or around the 3970-4000 area, forming a double top bear flag with the April 25 high.
   
6. If the market trades higher, they want the 4050 or the April 25 high to act as resistance.
   
7. They want the pullback to be weak, sideways, and lacking in strong follow-through buying (overlapping candlesticks, bear bars, doji(s), and prominent tails above candlesticks).
   
8. The bulls want a reversal from a lower low major trend reversal and a wedge pattern (Apr 9, Apr 22, and May 8). They want a failed breakout below the January low.
   
9. They hope to get at least a small two-legged sideways to up pullback lasting a few days. The pullback phase has begun.
   
10. If there is a pullback, they want at least a small second leg sideways to up to retest the current leg high (now May 13 high).
    
11. They want a TBTL (Ten Bars, Two Legs) Pullback, lasting about 2 weeks.
    
12. They must create follow-through buying, trading far above the 20-day EMA to increase the odds of a reversal.
    
13. While the selloff since the April 2 high to May 8 low was strong, the move has lasted a long time and is slightly climactic.
    
14. The wedge pattern increases the odds of a small 2-legged sideways to up pullback. The move is likely underway.
    
15. So far in the night market, the candlestick is an inside bull bar.
    
16. For tomorrow (Wednesday, 14/5/25), traders want to see if the bulls can create sustained follow-through buying, closing above the 20-day EMA. If they can do that, the odds of a 2-legged sideways to up pullback will increase.
    
17. Or will the market trade higher, but the market stalls around the 20-day EMA area (around 3950) and close with a long tail or a bear body instead? If this is the case, that would indicate the bulls are not as strong as they hope to be.
    
18. Breakouts from trading ranges can fail, and odds slightly favor the trading range to continue until there is a strong breakout with sustained follow-through selling/buying.
    

Andrew