16/5/25 Bears Need Strong FT to Resume Trend FCPO

1. Thursday's candlestick (May 15) was a big bear bar closing in its lower half with prominent tails.
   
2. In our previous report, we said traders would see if there would be a retest of the 4000 high area, and if the retest of the 4000 level is weak, sellers may return. Or would the bears be able to create a strong bear entry bar, which can lead to a retest of the May 8 low, even if it only forms a higher low.
   
3. The market traded formed a weak retest of the prior high in the night session, reaching the 3960 area, but sold off during the day.
   
4. The bears got a strong bear entry bar.
   
5. They see the recent rally as a pullback and hope that the move has alleviated the oversold conditions and want a resumption of the trend.
   
6. They want a reversal from a double top bear flag (April 25 and May 14).
   
7. They need to create a follow-through bear bar following Thursday's bear entry bar to increase the odds of a retest and breakout below the May 8 low.
   
8. The bulls want a failed breakout below the January low.
   
9. They want a TBTL (Ten Bars, Two Legs) pullback, lasting about 2 weeks.
   
10. They want the market to form a higher low followed by at least a small second leg sideways to up to retest the recent leg high (May 14 high).
    
11. The bulls must create strong bull bars trading far above the 20-day EMA to increase the odds of a reversal.
    
12. Soybean Oil is trading at the limit down today. Will we see a situation where there are consecutive days of limit down? If yes, this can't be good for palm oil.
    
13. Exports for the first 15 days seem decent +10 to 15%
    
14. Production is up marginally so far.
    
15. Refineries' appetite to buy in the last 2 days seems good.
    
16. For tomorrow (Friday, 16/5/25), traders want to see if the bears can get a strong follow-through bear bar. If they do, the odds of retesting the May 8 low increase.
    
17. Or will the market trade slightly lower, but close with a long tail below or a bull body, forming a higher low? If this is the case, that could indicate a lack of strength in the selling pressure.
    
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