15/5/25 Retest 4000 high or Can Bears Get a FT Bear Bar?

1. Wednesday's candlestick (May 14) was a bull doji closing in its lower half with a long tail above.
   
2. In our previous report, we said the traders want to see if the bulls can create sustained follow-through buying, closing above the 20-day EMA or if the market would trade higher, but 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).
   
3. The market traded higher above the 20-day EMA, but reversed off the day's high to close below it (the 20-day EMA). The long tail above and the candlestick closing in its lower half indicate the bulls are not yet strong.
   
4. The bears see the current move as a pullback. They hope that the pullback in the last 5 days has alleviated the oversold conditions and want a resumption of the trend.
   
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. Today (Wed, May 14), the market tested near the 4000 level and reversed off it, closing below 3950.
   
6. If the market trades higher, they want it to form a double top with the May 14 high (around the 4000 area)
   
7. They see today's candlestick (Wed, May 14) as a reversal bar and want a reversal from a double top bear flag with the April 25 high.
   
8. They need to create a strong follow-through bear bar tomorrow to increase the odds of a reversal down.
   
9. The bulls got 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.
   
10. They want a TBTL (Ten Bars, Two Legs) pullback, lasting about 2 weeks.
    
11. If there is a pullback lower, they want the market to form a higher low followed by at least a small second leg sideways to up to retest the current leg high (now May 14 high).
    
12. So far, the market traded above the 20-day EMA today (Wed, May 14) but could not close above it.
    
13. The bulls must create follow-through buying and trading far above the 20-day EMA to increase the odds of a reversal.
    
14. The wedge pattern increases the odds of a small 2-legged sideways to up pullback. So far, the minimum requirement has been fulfilled.
    
15. For tomorrow (Thursday, 15/5/25), traders want to see if there will be a retest of the 4000 high area. If there is, will it break above it or form a lower high? If the retest of the 4000 level is weak, sellers may return.
    
16. Or will the bears be able to create a strong bear entry bar? If yes, we may get a retest of the May 8 low, even if it only forms a higher low.
    
17. 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