As indicated by A, the KLCI ended 3.30 points lower on Wednesday, closing below the Bollinger Middle Band. Meanwhile, the Bollinger Bands Width continue to contract 3%, suggesting that the KLCI is still consolidating.

As shown on the chart above, the L2 and L1 Symmetrical Triangle remains in place, while the support for the KLCI is still at 885 WinChart Automatic Fibonacci Retracement; resistance for the KLCI is still at 905 WinChart Automatic Fibonacci Retracement.

As indicated by B, total market volume declined 14.4%, with the volume below the 40-day VMA level. Again, if volume should stay below the 40-day VMA level, it suggests that the overall market participation is still insufficient, as the KLCI direction is still unclear. Without sufficient market participation, the KLCI is likely to consolidate further with some downside biased.

As circled at C, the Stochastic break below 70% level, giving a signal suggesting a beginning of a technical correction. Therefore, the KLCI has ended its short term bullish signal. Unless the Stochastic could return to above the 70% level in the near future, the short term market movement of the KLCI is expected to turn weak.

The KLCI is dragged by the overnight Dow Jones Industrial Average losing nearly 300 points, coupled with the losses in most Asian markets. However, with the Symmetrical triangle still in place, the KLCI is set to consolidate further.

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