- Wednesday's candlestick (May 7) was a bear bar closing near its low.
- In our previous report, we said traders would see if the bears could create more follow-through selling below the January low, or if the candlestick closes with a long tail below or a bull body instead.
- The bears continue to get follow-through selling below the January low.
- 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.
- In the night market session, the candlestick is currently a small bear bar trading near its low, and near Wednesday's low.
- If the bears can get strong consecutive bear bars, that would increase the odds of a successful breakout.
- The bulls want a reversal from a lower low major trend reversal and a wedge pattern (Apr 9, Apr 22, and May 8).
- They hope to get at least a small two-legged sideways to up pullback lasting a few days soon.
- They must create strong bull bars over the next several days to increase the odds of a failed breakout.
- The market broke out below the January low on Monday with follow-through selling on Tuesday and Wednesday.
- The market could still trade at least a little lower tomorrow.
- Traders want to see if the bears can create sustained follow-through selling over the next several days. If they can do that, the odds of a successful breakout and a measured move will increase.
- So far in the night session, the candlestick is a small bear bar trading near its low.
- For tomorrow (Thursday, 8/5/25), traders will see if the bears can create another follow-through bear bar.
- Or will the market trade lower, but the candlestick closes with a long tail below or a bull body?
- The bulls need to do more to show they're back in control. So far, they haven't been able to do so.
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.