13/5/25 Bulls Need Strong Follow-through Buying FCPO

1. Friday's candlestick (May 9) was a bull doji closing above the middle of its range.
   
2. In our previous report, we said traders would see if the bulls could create sustained follow-through buying. If they can do that, the odds of a 2-legged sideways to up pullback will increase. Or if the market would trade higher, but the candlestick closes with a long tail above it or with a bear body instead. If this is the case, it would mean strong bears and weak bulls.
   
3. The market traded higher, followed by an intraday retest of the May 8 low, forming a higher low. Palm oil then traded off the day's low to close with a small bull body in its upper half. The bulls got some follow-through buying, although not as strong as they hoped, yet.
   
4. The bears want a strong breakout below the January low, followed by a measured move based on the height of the 5-month trading range, which would take the market to the 3200 area.
   
5. If the market trades higher, the bears want it to stall around the 20-day EMA (around 3950), forming a double top bear flag with the April 25 high.
   
6. 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).
   
7. 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.
   
8. They hope to get at least a small two-legged sideways to up pullback lasting a few days. The pullback phase may have begun.
   
9. They must continue creating follow-through buying to increase the odds of testing near the 20-day EMA.
   
10. They want a TBTL (Ten Bars, Two Legs) Pullback, lasting about 2 weeks. The pullback phase may be underway.
    
11. 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.
    
12. The wedge pattern increases the odds of a small 2-legged sideways to up pullback. The move could be underway.
    
13. Traders want to see if the bulls can create sustained follow-through buying tomorrow. If they can do that, the odds of a 2-legged sideways to up pullback will increase.
    
14. For tomorrow (Tuesday, 13/5/25), the market may gap up early. Traders will see if the bulls can create a follow-through bull bar closing near its high.
    
15. Or will the market trade higher, but the candlestick closes with a long tail above or a bear body instead (after gapping up)? If so, the bulls are not yet strong and lack strong follow-through buying.
    
16. 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