As indicated by A, the FBM KLCI retreated after testing the 1288.66 WinChart Automatic Fibonacci Retracement. Therefore, the resistance for the KLCI remains at 1288.66 WinChart Automatic Fibonacci Retracement, while the support is at 1276.38 and 1266.45 WinChart Automatic Fibonacci Retracement.

As shown on the chart above, the Bollinger Bands only expanded 1%, suggesting that the upside movement of the KLCI is being capped. If the Bollinger Bands should begin to contract, it would be a signal suggesting a consolidation for the KLCI. Meanwhile, the Bollinger Middle Band is still serving as the dynamic support for the KLCI, thus the immediate technical outlook is still positive.

As indicated by B, total market volume increased 2.9%, but failed to reach the 40-day VMA level. Therefore, the market participation as a whole is still insufficient, as investors confidence is still relatively low.

As indicated by C, the Stochastic is falling gradually, suggesting that the KLCI short term is losing some strength. However, since the Stochastic is still above the 70% level, the short term bullish signal remains intact.

In conclusion, with the KLCI resisted by the 1288.66 WinChart Automatic Fibonacci Retracement, and the insufficient market participation, the KLCI is due for a consolidation or a correction. And if the KLCI should remains supported by the Bollinger Middle Band after the possible correction, there is still a good chance that the KLCI would resume its uptrend.

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