Prepare the Pattern
Trace pattern (available, below) onto white paper. Using transfer paper, transfer pattern outline and all black design lines onto red felt for ornament front.
Embroider the Front
With white floss, work backstitches for saddle and mane outlines, split stitches for bridle, and French knots at dots on mane. Referring to pattern and using yellow floss, work lazy daisy stitches on mane and running stitches between white saddle outlines. With blue floss, work lazy daisy stitches on saddle and backstitches on mane. With yellow floss, work straight stitches in a V shape at top of each saddle lazy daisy stitch. With blue floss, work threaded running stitches for belly and chest straps.
Assemble the Ornament
Cut out embroidered front. Use pattern to cut a back from matching color of felt. With wrong sides together and using running stitches and floss that matches felt, sew front and back together, working close to the edges. As you stitch, stuff shape with fiberfill and catch ends of a satin ribbon hanging loop between felt pieces at base of mane.