As indicated by A, the KLCI rebounded from the T2 uptrend line again on Monday, and marked a new high. Therefore, the T2 line together with the Bollinger Middle Band are still the dynamic support for the KLCI, while the resistance is still at 1077 WinChart Automatic Fibonacci Retracement.

As shown on the chart above, the Bollinger Bands Width is still contracting, suggesting that the consolidation for the KLCI has not yet ended. Generally, the Bollinger Bands Width has to re-expand significantly in order to signal a beginning of a new movement.

As indicated by B, total market volume declined 9.2%, despite the KLCI making new high, as a result, the volume failed to break above the 40-day VMA level. This shows that the market participation is relatively insufficient, thus failing to confirm the break out of the resistance, and there is a risk of a false breakout of the 1053 resistance.

As circled at C, the Stochastic remains above 70% level, which is a short term bullish region, suggesting the short term movement of the KLCI is still bullish biased. If the Stochastic should break below 70% level, it would be a signal suggesting a beginning of a technical correction.

Based on the chart of KLCI, the uptrend is still in place, however, the lack of volume is a major concern right now for volume is a very important indicator in Technical Analysis, and therefore, in order to sustain its uptrend, the market volume has to return to above 40-day VMA level, or else, there is a risk of a reversal.

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