KLCI continued its technical rebound on Thursday (14/04/05) but soon reached the resistance at 878.96 of WinChart automatic Fibbonaci retracement, and amazingly closed at 877.23, the down trend channel resistance (T1). This implies that the down-trend channel is very effective, and therefore, if KLCI would to break away from the down-trend, it has to break away from the T1 resistance coupled with strong volume.

10 days Bollinger Band contracted 3% while KLCI closed above the middle-band. Therefore, if Bollinger Band widens in the following day(s), and KLCI closed above the middle band, we should see more upside movement.

As shown in B, volume of Bursa Malaysia increased a fraction of 5.4% to 395,069,400 shares. However, it is still below the 40 days Volume Moving Average (VMA). Hence, the upside potential for KLCI is in doubt.

As indicated in circle C Stochastic broke above the 70% and entered the short-term bullish zone. KLCI is likely to continue its upside movement provided the STC stays above 70%.

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