Webull ($BULL): The Chart Warned Before the Collapse – Volume Price Analysis Breakdown

When I was asked to consider Webull ($BULL) I did not expect a stock that had simultaneously run into a geopolitical and regulatory buzzsaw unlike Recursion ($RXRX) and Prime Medicine ($PRME) – where it was corporate dilution loops and clinical milestones that helped to construct multi-year bottoms.

This is the current reality facing Webull Corporation ($BULL)

On October 7, a bipartisan report from the House Select Committee on China revealed deep, structural workforce ties between the broker-dealer and mainland China. The resulting headlines also triggered instant securities fraud lawsuits and an immediate 20%+ single-day collapse. To most observers, this was an unpredictable headline-driven disaster. But the market always leaves a trail of evidence, and for volume price analysis (VPA) tape readers, the chart left behind a trail of breadcrumbs before the dam broke. By applying Richard Wyckoff’s Law of Effort vs Result to the weekly chart, we can deconstruct $BULL and see what happened.

In August $BULL released stellar Q3 corporate earnings. Traders rushed to chase the breakout, pushing the stock higher. But a close look at the underlying volume context: the price moved higher on sharply falling volume.

● The VPA Verdict: This is a classic case of Momentum Exhaustion.

● The Effort vs. Result Fail: Price made progress, but institutional effort completely dried up.

● The Insiders: Refused to back the move, leaving $BULL vulnerable.

Plus, when we consider the weekly chart and remember Charlie Munger’s famous axiom we can see $BULL is firmly below the 200MA. Meanwhile, the daily chart offered some comfort, as Webull was above its 200 MA. However, the failure of the September 3rd candle to take out the earnings high marked the beginning of the slide lower. In addition, when we compare the volume of this candle against the earnings candle. It’s not hugely different, but enough to classify as an anomaly. The subsequent waterfall, characterised by gap downs on rising volume, resulted in $BULL breaking through the 200MA, and despite the three-candle correction back through the 200MA, the slide lower resumed with $BULL eventually finding a floor at the $7 region.

Webull Executives Selling

Behind the scenes, prominent Webull executives were also selling, cashing out before the House Committee’s report wiped out 19% of Webull’s value. When the news dropped on 7 October, $BULL gapped down to a low of $5.51 on massive volume (81.42m), forming a volatility candle with an overall spread of 52c and a deep lower wick. The candle not only giving us an anomaly but also confirming stopping volume. As per the rule of our Quantum volatility candle, it was no surprise to see the price re-trace into the spread of the candle, before gapping higher. Since then $BULL has been trading sideways between a high of $$6.44 and a low of $5.82.

Where Next For Webull

The question now is where next, and to answer it we need to return to the weekly chart to see whether supportive volume at the $5.51 structural floor signals institutional accumulation trying to anchor a bottom. However, looking at equity volume alone ignores this week’s true master of ceremonies: the options market. Why? Because an Option-to-Stock (O/S) Volume Ratio of 42.79% means option traders are dictating terms. An extreme Put/Call ratio of 0.21 shows a lopsided market, with call buyers betting on an immediate rebound. Today (Thursday 22nd October) $BULL closed at $5.92 which, according to Barchart, is perched just under the $6.04 Gamma Flip.

If bulls can force the price across the $6.00 strike price tomorrow, it will trigger a gamma squeeze to solidify the recovery. If they fail, a wave of expiring options premium will force dealers to unwind and dump their stock hedges into the close, pushing Webull to a retest of its structural weekly lows. For Webull, this week’s option expiration will decide whether the bottom is truly in.

By Anna Coulling – creator of volume price analysis

By Anna Coulling – creator of volume price analysis