As indicated by A, the FBM KLCI ended lower on Monday, as pulled down by the lower regional markets, the KLCI loss 3.66 points closing at 1296.79 points. The KLCI formed a relatively smaller Hammer candlestick, suggesting a possible technical rebound ahead. Since the KLCI is now below the 1300 level, the 1300 is the immediate resistance followed by the next resistance at 1354 WinChart Automatic Fibonacci Retracement; while the support is at 1290 WinChart Automatic Fibonacci Retracement.

As shown on chart above, the Bollinger Bands contracted 4%, suggesting that the KLCI is still consolidating. With the KLCI now below the Bollinger Middle Band, the immediate outlook for the KLCI is turning weak.

As indicated by B, total market volume declined 1.2% while still above the 40-day VMA level. Therefore, the overall market participation is still sufficient, and if the market volume should remain above the 40-day VMA level, the overall sentiment is likely to remain positive.

As indicated by C, the MACD breaks below the trigger line, suggesting a weakening movement for the KLCI. If the MACD line should also break below the zero level, it would be a signal suggesting that the longer term movement of the KLCI is also turning weaker.

In short, the KLCI has to return to above the Bollinger Middle Band as well as the 1300 level, or else, the risk of a reversal would be higher.

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