As indicated by A, the FBM KLCI touched its daily high at 1288.42 points, but failed to keep its gain as traders took profit, the KLCI only gained 1.64 points at the close at 1279.95 points. Support for the KLCI remains at 1270 and 1248 WinChart Automatic Fibonacci Retracement while the resistance is still at 1300 level.

As shown on the chart above, the Bollinger Bands contracted 7%, suggesting that the KLCI might be consolidating again. In addition, the KLCI formed a narrow candlestick on Tuesday, suggesting that the KLCI is likely to consolidate.

As indicated by B, total market volume declined 2.8%, but volume is still above the 40-day VMA level. This shows that the overall market is well-participated. Generally, if volume should fall back to below the 40-day VMA level, it would be normal for the KLCI might be consolidating again.

As indicated by C, the Stochastic retreated slightly, but managed to stay above 70% level, this shows that the short term movement for the KLCI is still bullish biased.

In short, the KLCI is likely to consolidate again, as the Bollinger Bands is contracting again. However, the overall trend is still bullish biased, because it is still supported by the Bollinger Middle Band; unless, the KLCI should break below the Bollinger Middle Band.

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