EXPI Forms Doji at $9.00 Support After Seven-Week Decline — Bulls Test the Bottom

The doji is a single-candle reversal signal that derives its name from the Japanese word for "mistake." This distinctive pattern forms when the opening and closing prices are identical or nearly identical, creating a horizontal line or cross-like shape on the chart. The doji appears most commonly after extended trends and signals that the balance of power between bulls and bears has reached equilibrium—a state of indecision that often precedes a directional shift.

As Stephen Bigalow explains in Profitable Candlestick Trading, "the formation is created when the opening price and closing price are the same. This forms a horizontal line. The implication is that the bulls and the bears are in a state of indecision."

The doji reveals critical information about market psychology. After a sustained trend, the appearance of a doji indicates that the dominant force—whether buyers in an uptrend or sellers in a downtrend—has lost the conviction needed to maintain momentum. When evaluating doji quality, check whether the pattern appears after a significant move and whether technical indicators like RSI confirm overbought or oversold conditions.

The ideal doji features shadows extending above and below the horizontal line, demonstrating that both bulls and bears attempted to control the session but neither prevailed. The pattern gains significance when it appears after long candles, at major support or resistance levels, or when accompanied by extreme oscillator readings. A gap separating the doji from the previous session enhances its reversal potential.

eXp World Holdings carved out a punishing seven-week decline from $12.00 in mid-November to test $9.00 by early January. The selloff unfolded through a series of predominantly red candles, each grinding lower as the stock shed roughly 25% of its value. By year-end, EXPI had broken decisively below its 50-day moving average at $10.48 and continued pressing into oversold territory.

Looking at the chart, we can see Friday's session opened at $9.11 and traveled to an intraday high of $9.20 before sellers pushed price down to test $8.99—the lowest point in the seven-week decline. The stock then recovered to close at $9.10, creating a small $0.11 real body positioned near the session's midpoint. Notice in the formation how this tight open-to-close range, representing just 1.9% of the $9.10 closing price, meets the classic definition of a doji: a session where opening and closing prices are nearly identical.

Here's where pattern quality matters: the doji formed with both upper and lower shadows of meaningful length ($0.09 upper shadow, $0.11 lower shadow), demonstrating genuine back-and-forth battle rather than quiet consolidation. The volume of 1.23 million shares exceeded recent average turnover, indicating active participation during this moment of indecision.

This doji gains significance from forming at the confluence of three bearish exhaustion signals visible in the chart. First, the $8.99 low represents a seven-week extreme—the point where selling finally met resistance. Second, the RSI reading of 27.13 sits deep in oversold territory below the 30 threshold, matching levels last seen during prior bottoming processes. Third, the Stochastic oscillator shows both %K and %D lines compressed in the lower band near historical extremes, while the "Regular Bullish" label visible in the table data suggests potential divergence developing.

Educational Note: The following describes common approaches used by candlestick practitioners and is not trading advice. All trading involves significant risk.

Traders typically wait for confirmation before acting on doji signals that appear in downtrends. When following patterns in real time, watch for a decisive green candle that closes above the doji's high—in this case, confirmation would require Monday's session to close above $9.20. This bullish follow-through validates that buyers have seized control and that the doji marked genuine accumulation rather than a temporary pause before further decline.

When defining risk for potential reversal setups, identify where the pattern would be invalidated. For this EXPI doji, a stop below Friday's $8.99 low provides defined risk of approximately $0.21 per share from a confirmation entry near $9.20. This stop placement respects the logic that if sellers can drive price to new lows below the doji's range, the indecision signal has failed and the downtrend remains intact.

Look for targets by scanning for overhead resistance levels visible on the chart. Initial profit zones sit at the $9.50 minor resistance area and the more substantial $10.00 psychological level. The ultimate target would be a retest of the 50-day moving average near $10.48, representing approximately 14% upside from current levels.

Confirmation requires a strong green candle closing decisively above $9.20—ideally on volume exceeding Friday's 1.23 million shares—while a break below $8.99 in the next 1-2 sessions would invalidate the reversal thesis and suggest the downtrend maintains its grip.

Pattern Formation at Critical Low: The doji formed precisely at $8.99, marking a seven-week low after EXPI declined 25% from $12.00 resistance, with RSI at 27.13 signaling deeply oversold conditions.

High-Quality Technical Setup: Friday's session created a textbook doji with nearly identical $9.11 open and $9.10 close, complemented by balanced upper and lower shadows demonstrating genuine indecision after extended selling.

Confirmation Protects From False Signals: Pattern validation requires Monday's close above $9.20, as doji signals in downtrends need bullish confirmation—the weight of the market can still force prices lower without follow-through.