On Monday, the KLCI continued its consolidation, closing 0.7% lower to 890.28 points. Support for the KLCI remains at 887 WinChart Automatic Fibonacci Retracement while the resistance is still at 900 psychological level. (Study A)

As shown on the chart above, the Bollinger Bands Width expanded only 5%, and therefore, it is still insignificant to be considered as any signal, for the expansion of the Bollinger Bands Width has to be obvious in order to signal a direction for the KLCI.

As indicated by B, total market volume declined 22.8%, suggesting that the KLCI is still consolidate, and no sign of any panic selling. But still, if the KLCI should attempt to rally and retest its resistance, volume above the 40-day VMA level is an important element to support the KLCI momentum.

On Monday, the MACD continue to fall, suggesting that the KLCI is still losing strength. In short, the MACD histogram has to form a rounding bottom as indicated by the C arrow in order for the KLCI to regain some strength.

To sum up, the direction for the KLCI remains unclear. If the Bollinger Bands Width should expand with the KLCI below the 40-day VMA level, it would be a bearish biased movement for the KLCI. Therefore, the KLCI must break above the Bollinger Middle Band in the near future in order to avoid the bearish biased movement.

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