Despite the early gains, the FBM KLCI closed only marginally higher, gaining 0.56 points, to close at 1242.32 points. As indicated by A, the 1248 WinChart Automatic Fibonacci Retracement is still the resistance for the KLCI while the 1220 and the 1226 WinChart Automatic Fibonacci Retracement are the supports for the KLCI.

As shown on the chart above, the Bollinger Bands only expanded 6%, this implies that the Bollinger Bands might stop expanding, thus a signal suggesting that the KLCI may stop falling temporary. However, the KLCI still has to break above the Bollinger Middle Band in order to break away from the bearish biased movement.

As indicated by A, total market volume increased 20.5%, with volume firmly above the 40-day VMA level. This shows that the market is still actively participated. Meanwhile, the increase of volume also suggest an increase of intensity of conflict between bullish buyers and bearish sellers.

As indicated by C, the Stochastic %K line is still below 30% level, despite crossing above the %D line. Therefore, the short term movement for the KLCI is still bearish biased.

In conclusion, profit taking has capped the KLCI upside movement on Tuesday, but the overall market is still supported by strong buying interest, as the KLCI is still consolidating. Nonetheless, with the KLCI still below the Bollinger Middle Band, coupled with the Stochastic below 30% level, the immediate outlook for the KLCI is still bearish biased.

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