As circled at A, the KLCI rebounded on Monday after breaking below the 20-day Bollinger Lower Band last Friday and triggered an over-sold signal, and as a result, the KLCI had a Pull-back effect on Monday, which is a form of technical rebound. Generally, the first target of a Pull-back effect is at the Bollinger Middle Band. If the KLCI should remain resisted by the Bollinger Middle Band after this pull-back effect, the outlook for the KLCI shall remain bearish biased. Nevertheless, support for the KLCI is now at 926.22 WinChart Automatic Fibonacci Retracement while the resistance are at 982.49 WinChart Automatic Fibonacci Retracement followed by the Bollinger Middle Band dynamic resistance.

As indicated by B, total market volume declined 19.2%, but still remain above the 40-day VMA level. This shows that the market is still relatively active. If the KLCI should continue to rebound with volume above the 40-day VMA level, the KLCI would have a better chance to break away the downtrend. However, the KLCI must first break above the Bollinger Middle Band important resistance.

As circled at C, the Stochastic also rebounded slightly on Monday, but still below 30% level, which is the short term bearish region. If the Stochastic should break above the 30% level, it would be a signal suggesting a beginning of a short term technical rebound for the KLCI.

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