As indicated by A, the Bollinger Bands Width of the KLCI only expanded 2%, from the previous 4%, suggesting that the KLCI is beginning to consolidate, while only waiting for the contraction of the Bollinger Bands Width to confirm such signal. Resistance for the KLCI remain at 1053 WinChart Automatic Fibonacci Retracement while the 200-day MA is still the support together with the Bollinger Middle Band dynamic support.

As indicated by B, total market volume increased 18.3%, marked another new high. The increased of volume means more participation, but since the KLCI is consolidating, the high volume on Monday is actually viewed as a stronger selling pressure caused by profit taking activities while the KLCI is closer to its strong resistance.

As circled at C, despite some profit taking activities, the Stochastic remains above 70% level, suggesting that the short term movement for the KLCI is still bullish biased. If the Stochastic should break below 705 level, it would be a signal suggesting a beginning of a technical correction.

From the technical point of view, if the KLCI should consolidate with lower volume, it would be a healthy sign. However, the KLCI is not moving sideways with increasing volume at record level, this is implying that the selling pressure is relatively stronger and the risk of a technical correction is inevitable. Nevertheless, should the KLCI starts a technical correction, the first target will be the Bollinger Middle Band. If the KLCI should rebound from the Bollinger Middle Band, there is a chance of a resume of its uptrend. On the other hand, if the KLCI should break below the Bollinger Middle Band, the immediate outlook for the KLCI would turn negative.

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