WinChart Technical Analysis
Daily Market analysis
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Despite the overnight Dow Jones Industrial Average closing over 200 points lower, the KLCI managed to stay within its narrow consolidation range, losing only 6.8 points. As indicated by A, the Bollinger Bands Width contracted 1%, suggesting that the KLCI consolidation continues. Nonetheless, resistance remains at 1300 psychological level while the support is still 1244 Fibonacci line.
As indicated by B, total market volume declined 24% on Thursday, and stayed below the 40-day VMA level. Although this is a sign of insufficient market participation, it is viewed as a healthy signal as the KLCI ended lower with relatively thin volume. Nevertheless, if the KLCI should test the 1300 resistance, volume must break above the 40-day VMA level.
As circled at C, the MACD line crosses below the trigger line and triggered a bearish signal. However, it is important to know that as the Bollinger Bands Width contracts, the significance of the secondary indicators signal is reduced.
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