As indicated by A, the KLCI tested the 920 WinChart Automatic Fibonacci Retracement again on Monday, suggesting that the KLCI is attempting to resume its rally. The next resistance for the KLCI is at 940 followed by the 972 WinChart Automatic Fibonacci Retracement, while the immediate support is at 920 level.

As shown on the chart above, the Bollinger Bands Width contracted only 1%, suggesting that the direction for the KLCI is still unclear, despite the KLCI ended 4.5 points higher. But still, since the KLCI is still above the Bollinger Middle Band, the immediate outlook for the KLCI is still on the positive side. If the Bollinger Bands Width should re-expand with the KLCI remain above the Bollinger Middle Band, it would be a bullish signal for the KLCI.

As indicated by B, total market volume increased 38.3%, with volume above the 40-day VMA level. This shows that the market participation is now relatively sufficient, as it is the most important element to sustain any rally of the KLCI.

As indicated by C, the Stochastic is still above the 70% level, which is the short term bullish region. Therefore, the market movement for the short term is still bullish biased, until the Stochastic should break below the 70% level. To sum up, despite the consolidation, the KLCI is still showing some positive signs, and if the Bollinger Bands Width should expands again, more up side room is expected for the KLCI.

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