On Thursday, the KLCI lost 2.01 points, to close at 1284.09 points. As indicated by A, the 1288.66 WinChart Automatic Fibonacci Retracement is still the resistance for the KLCI while the support are found at 1276.38 followed by the 1266.45 WinChart Automatic Fibonacci Retracement.

As shown on the chart above, the Bollinger Bands contracted 4%, and this is a signal suggesting a consolidation for the KLCI. However, with the KLCI above the Bollinger Middle Band, the immediate technical outlook for the KLCI is still on the positive side.

As indicated by B, total market volume declined 15.9%, with volume below the 40-day VMA level. This clearly suggests that the overall market is lightly participated, as investors confidence is still low. Therefore, the KLCI does not have the most ideal uptrend condition.

As indicated by C, the Stochastic is still falling, but has not broken below 70% level. Therefore, the short term bullish signal remains intact. If the Stochastic should break below 70% level, it would be a signal suggesting a beginning of a technical correction for the KLCI.

In conclusion, the KLCI is still resisted by the 1288.66 WinChart Automatic Fibonacci Retracement, and due to the lack of market participation, the KLCI is losing some strength, and therefore, it is likely that the KLCI would consolidate from now.

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