Composite Index pulled back on Monday, easing 1.29 points to 897.01 points. As shown on the chart above, the KLCI was resisted by the 899.73 or the 900 Fibonacci, as well as the psychological resistance level. On the other hand, support for KLCI is now at the T1 and the 10 days Bollinger middle band. (Study A)

10 days Bollinger band width contracted another 13%, indicating that the direction for KLCI is still unclear, or KLCI is likely to be in a consolidation phase.

Total market volume for the day only stood at 1.87 million lots, a 18.8% lower than last Friday's market volume. While this is rather normal since the KLCI is having a pull back from the break out, but it is sure not a good sign if the volume remain low in the coming trading days. (Study B)

%K of the Stochastic remained in the short-term bullish zone with the %D staying in the neutral zone. If the %D failed to break above the 70% level, there is no confirmation that the short-term market sentiment is bullish.

According to the historical data of KLCI, a pull back after a break out is rather normal. But in order for KLCI to have a rally, we must see the volume to pick up rather quickly after the break out, or else a rally is not likely to happen without growing volume.

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