As shown on the chart, the Bollinger Bands expanded 28%, with the FBM KLCI below the Bollinger Middle Band, and therefore, the KLCI ended lower, while the bearish biased outlook remain intact. As indicated by A, the KLCI breaks below the 1257 WinChart Automatic Fibonacci Retracement, and therefore, the next support is at 1237 WinChart Automatic Fibonacci Retracement while the resistance is at 1288 WinChart Automatic Fibonacci Retracement.

Since the KLCI is only breaking the 1257 WinChart Automatic Fibonacci Retracement by margin, it is still likely that the KLCI would be supported by the 1257 WinChart Automatic Fibonacci Retracement. Nonetheless, should the KLCI continue to fall, it would be testing its next downside target which is 1237 WinChart Automatic Fibonacci Retracement (38.2% Retracement).

As indicated by B, total market volume declined 2.6%, with volume below the 40-day VMA level. Therefore, this shows that the overall market participation is still very low, as investors are still staying on the sidelines. With volume so weak, the KLCI is less likely to pick some strength.

As circled at C, the Stochastic is breaking the 30% level, suggesting that the short term movement of the KLCI is turning weak. If the Stochastic should stay below 30% level, the short term outlook for the KLCI shall remains bearish biased.

In short, the KLCI shows signs of turn weak, and if the KLCI should really break below the 1257 level, it would form a downtrend. Meanwhile, the bearish biased movement remains intact, unless the Stochastic should break above 30% level, and the KLCI breaking above the Bollinger Middle Band, then only the KLCI would regain some strength and avoid the downtrend formation.

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