On Monday, the KLCI closed marginally lower and precisely supported by the Bollinger Middle Band. (Study A). Therefore, the Bollinger Middle Band is still serving as the dynamic support for the KLCI. Currently, support for the KLCI is still at 1011 points while the resistance remain at 1040 points.

As shown on the chart, the Bollinger Bands Width is still contracting, suggesting that the KLCI is still consolidating in its sideways movement. The sideways movement shall continue if the Bollinger Bands Width should continue contracting. Until the Bollinger Bands Width re-expands, the direction for the KLCI shall remain unclear. If the Bollinger Bands Width should expands, it would be a signal suggesting a beginning of a new movement, and the direction of that new movement is determined by the position of the KLCI above or below the Bollinger Middle Band.

As indicated by B, total market volume declined another 12.8% on Monday, and volume continue to stay below 40-day VMA level as investors choose to stay on the sidelines. Again, if the KLCI should move sideways, it is generally normal to have lower volume. But if the KLCI should start rising, it must confirm with the volume above the 40-day VMA level.

Despite the KLCI sideways movement, the MACD histogram is still rising. Still, if the Bollinger Bands Width is contracting, significance of other secondary indicators signals are reduced. Therefore, at the moment, the priority of the analysis is still the Bollinger Bands.

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