Composite Index Daily Technical Analysis, 05/05/2005. 

On Thursday, 05/05/2005, KLCI opened high at 904.94 with a gap, but the gap was soon filled. Thursday’s candlestick has a long lower shadow line, which signaled the sentiment for the day was mixed. (Study A) 

For the day, KLCI closed mixed, up 0.99 point. The current support level is at the WinChart Automatic Fibonacci Retracement of 900.38 points. As for the Resistance, it would be the WinChart Automatic Fibonacci Retracement of 909.95 points. Volume trade on Thursday was up 0.6%, above the 40 days Volume Moving Average (VMA) (Study B) 

KLCI candle remained above away the 20 days Bollinger Band upper band. Therefore, a pull-back effect is due to happen. As shown in C, RSI has stayed above 70% level, entering the mid-term bullish zone. Therefore, the mid-term sentiment of KLCI is bullish. 

From the Technical Analysis point of view, KLCI is still due for a correction, for two important factors. One of which is the pull-back effect, and the other one is the Stochastic has shown a first sign of short-term correction. However, since the mid-term sentiment of the overall market is still positive, a minor correction or pull-back is absolutely healthy.

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