On Thursday, the FBM KLCI tested the Bollinger Middle Band, but failed, and ended 0.39 points lower. This shows that the Bollinger Middle Band is still the dynamic resistance for the KLCI, while the next resistance is still at 1300 psychological level. Support for the KLCI is at 1270 WinChart Automatic Fibonacci Retracement.

As indicated by A, the KLCI is still supported by the L1 uptrend line, and the 1270 WinChart Automatic Fibonacci Retracement is also over-lapping the L1 uptrend line, and therefore, it is going to be an important support. If the KLCI should break below the L1 uptrend line, it would be an end to the uptrend.

As indicated by B, total market volume increased 1.5%, with volume still below the 40-day VMA level. In short, this suggests that the market is relatively quiet, as the KLCI is now moving sideways.

As circled at C, the stochastic breaks below 30% level, entering the short term bearish region. If the Stochastic should remain below 30% level, the market movement for the short term is expected to be bearish biased.

As shown on the chart above, the Bollinger Bands is now narrowing, and the significance of the Stochastic signal is reduced. Nonetheless, the short term signal of the Stochastic has to be confirmed with the re-expansion of the Bollinger Bands. If the KLCI should remain below the Bollinger Middle Band as the Bollinger Bands expand, it would be a downside signal, and otherwise, an upside signal.

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