As the over-night Dow Jones Industrial Average Index losing more than 500 points, the Asian markets were affected, including the KLCI. As indicated by A, the KLCI opened with a gap, and generally, the KLCI is likely to fill the gap. Support for the KLCI is at 1000 psychological level while the 1035 WinChart Automatic Fibonacci Retracement is still the resistance.

As shown on the chart, the Bollinger Bands Width is still expanding 13%, with the KLCI below the Bollinger Middle Band. Therefore, the bearish biased movement for the KLCI remains intact, until the Bollinger Bands Width contracts. If the Bollinger Bands Width should contract, it would be a signal suggesting a consolidation for the KLCI.

As indicated by B, total market volume increased 27%, which touches the 40-day VMA level, suggesting an increase of conflict between fearful sellers and some bargain buyers, therefore, if volume should remain above the 40-day VMA level, the KLCI would have a better chance to fill up the gap.

As circled at C, the Stochastic remains below 10%, which is the short-term over-sold region. This suggests that the short term market movement is indeed bearish, Nevertheless, the over-sold signal suggests a technical rebound could take place in the near future. Generally, the Stochastic has to break above 30% level to signal a beginning of a technical rebound.

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