Due to heavy selling of some blue chips counters, the KLCI ended 11.98 points lower on Thursday to close at 838.39 points. As indicated by A, support for the KLCI is at 833 WinChart Automatic Fibonacci Retracement while the resistance is at the Bollinger Middle Band dynamic resistance and the 853 WinChart Automatic Fibonacci Retracement.

As shown on the chart above, the Bollinger Bands Width continue to expand 11%, with the KLCI remained below the Bollinger Middle Band. Therefore, the immediate outlook for the KLCI is still bearish biased.

As indicated by B, total market volume declined 6.1%, and therefore, the volume is now below the 40-day VMA level. This shows that the overall market participation is still insufficient, thus the KLCI is less likely to regain its strength in the absence of fresh leads.

As circled at C, the MACD histogram is still falling while no rounding bottom signal is sighted yet. Therefore, this suggests that the KLCI is still losing strength. If the MACD histogram should form a rounding bottom, it would be a signal suggesting a technical rebound for the KLCI.

As the Bollinger Bands Width is still expanding, it suggests that the downside volatility of the KLCI is still increasing, thus more downside room for the KLCI is expected. Therefore, unless the Bollinger Bands Width should contract, the bearish biased movement of the KLCI is expected to continue.

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