- Friday's candlestick (May 16) was a follow-through bear bar with tails.
- In our previous report, we said traders would see if the bears could get a strong follow-through bear bar. If they do, the odds of retesting the May 8 low increase. Or if the market would trade slightly lower, but close with a long tail below or a bull body, forming a higher low instead.
- The bears got a follow-through bear bar, albeit not a big one.
- 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.
- They want a reversal from a double top bear flag (April 25 and May 14).
- They need to create more follow-through selling to increase the odds of a retest and breakout below the May 8 low.
- If the market trades higher, they want it to form a lower high. They want it to stall below the 20-day EMA (around 3900). They want any pullback higher to lack follow-through buying.
- The bulls see the current move as a retest of the prior trend's extreme low (May 8).
- 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), even if it only forms a lower high.
- The bulls must create strong bull bars trading far above the 20-day EMA to increase the odds of a reversal.
- Exports for the first 15 days seem decent, +10 to 15%
- Production is up marginally so far.
- Refineries' appetite to buy in recent days seems good.
- For tomorrow (Monday, 19/5/25), traders want to see if the bears can get another follow-through bear bar. If they do, the odds of retesting the May 8 low increase.
- Or will the market form a retest of the May 14 high, even if it only forms a lower high?
- The weekly candlestick closing near its low slightly favor the market to trade at least a little lower sometime this week.
Andrew
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Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.