As shown on the chart above, the Bollinger Bands contracted 8%, and the KLCI technically rebounded, breaking above the Bollinger Middle Band as well as the 1248 WinChart Automatic Fibonacci Retracement. Support for the KLCI is now at 1248 WinChart Automatic Fibonacci Retracement while the resistance is at 1270 WinChart Automatic Fibonacci Retracement.

With the KLCI now above the Bollinger Middle Band, the immediate outlook is turning positive. Therefore, if the Bollinger Bands should re-expand with the KLCI remains above the Bollinger Middle Band, there is a good chance that the KLCI would resume its uptrend.

As indicated by B, total market volume declined 3.1%, with volume still above the 40-day VMA level. Overall, the market is still widely participated, thus giving a positive lift to the market sentiment.

As indicated by C, the Stochastic broke above 30% level, suggesting that the KLCI is breaking away from its short term bearish region. Which is also a signal of a technical rebound. If the Stochastic should return to above 70% level, it would be a signal suggesting that the short term movement of the KLCI is getting bullish.

Although some selling pressure has pulled down the KLCI, it was well-absorbed by the increased of buying interest as volume increases. Now that the KLCI is breaking above the Bollinger Middle Band, the KLCI outlook is expected to improve. Provided that the Bollinger Bands should re-expand with the KLCI above the Bollinger Middle Band, the improvement of the KLCI is likely to carry on, unless the KLCI should failed to stay above the Bollinger Middle Band.

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