As the Dow Jones Industrial Average closing at its 6 years old, coupled with the Asian markets closing lower, the KLCI broke below the Bollinger Middle Band, closing 9.88 points or 1.1% lower. Support for the KLCI remains at 885 WinChart Automatic Fibonacci Retracement while the resistance is still at 905 WinChart Automatic Fibonacci Retracement.

As shown on the chart above, the Bollinger Bands Width is still contracting, and the KLCI is still staying within the Symmetrical Triangle, suggesting the consolidation of the KLCI is still in place.

As indicated by B, total market volume increased 10.6%, but still below the 40-day VMA level. This shows that the market participation is still relatively lower, and it is still considered normal if the KLCI should continue to consolidate. However, if the KLCI should break below the Symmetrical Triangle with a significant increased of volume, it would be a signal suggesting an increased of selling pressure, thus would further dampen the market sentiment.

As circled at C, the Stochastic failed to sustain above the 70% level, breaking both 50% and 30% level on Friday. This shows that the short term movement of the KLCI is now turning weak. If the Stochastic should remain below 30% level, the market movement for the short term is expected to be bearish biased.

In short, other than suggesting a consolidation signal, the Symmetrical Triangle also can provide a timing signal, that is when the KLCI either break above or below the Symmetrical Triangle. If the KLCI should break below the Symmetrical Triangle, it would be a signal suggesting an end to the consolidation, and a beginning of a downside movement.

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