In September, we noticed a bullish breakout in shares of Caterpillar $CAT. Caterpillar Inc. (CAT) in a Bullish Continuation BreakoutThis breakout signaled a bullish continuation, but there was a key resistance pivot at $161.50 that presented the first challenge. Price retreated after approaching the $160 handle.CAT Daily Chart(click to enlarge)Wedge Breakout and Pullback:- The daily chart shows a market that was bullish entering 2018. - Then, price developed a falling wedge until the September bullish breakout.- The current pullback was exacerbated by the overall market downturn in the past couple of weeks. - So, we are seeing a deep pullback. But does deep pullback invalidate the bullish outlook?Still Bullish:- The breakout from the wedge is in question. - BUT, also note the consolidation between July and September. - Price is still respecting that consolidation as a base right now. - A hold above $140 should be a positive sign for the bullish outlook.- A break below $137.40 on the other hand would be a strong signal that the market has reverted back to the bearish correction mode. This would open up the $130 area. - Meanwhile, if we do see a bullish attempt, the $150-$152.50 area will be potential resistance in the short-term.- A break and hold above $150 would be a strong signal for the bullish outlook. - For now, I am cautiously bullish on CAT, but might change my mind if price falls below $140, and then below $137.40.