As indicated by A, the KLCI tested the 1140 WinChart Automatic Fibonacci Retracement and closed marginally above the 1140 level. In other words, the KLCI has to stay above the 1140 level successfully in order to be considered as a true breakout. As shown on the chart, the next resistance line for the KLCI is the T1 downtrend line. If the KLCI should break above the T1 line, it would end the downtrend which started since 16th of May.

As shown on the chart, the Bollinger Bands Width expanded 1%, and the KLCI remains above the Bollinger Middle Band. Since the KLCI is now above the Bollinger Middle Band, and therefore, if the Bollinger Bands Width should further expand, there are more upside room for the KLCI.

As indicated by B, total market volume declined 13.7%, but the volume remain above the 40-day VMA level. This suggests that the market is overall well-participated, and this is surely a positive element for the KLCI.

As circled at C, the Stochastic remain above the 70% level, suggesting a short term bullish signal. However, readers are advised to monitor the Stochastic, for if the Stochastic should break below the 70% level, it would be an end to the short term bullish signal, thus a beginning of a short term technical correction.

Find this analysis useful? Why not share it with others? Click Here to send this to a friend

Straits Index (M) Sdn Bhd
No. 16, Jalan LP 1A / 5, Lestari Perdana,
43300 Seri Kembangan, Selangor
Hotline: (03) 8941 6828  (5 lines)   Fax: (03) 8941 9828    
Email: info@straitsindex.com
© Copyright 1997-2008 Straits Index (M) Sdn Bhd All rights reserved