On Wednesday, the KLCI fell 21.96 points or 1.6%, to close at 1308.23. As indicated by A, the KLCI breaks below 1320 WinChart Automatic Fibonacci Retracement and it is the biggest fall in one day since 24th of March, 2008.

Support for the KLCI is now at 1302, which is the 1300 psychological level, while the immediate resistance is at 1320 WinChart Automatic Fibonacci Retracement followed by 1350.

As shown on the chart above, the Bollinger Bands expanded 82%, with the KLCI below the Bollinger Middle Band, thus giving a bearish signal. If the Bollinger Bands should continue to expand, more bearish movement is expected for the KLCI.

As indicated by B, total market volume increased 13.1%, suggested some increased of selling pressure, but not too extreme. Nevertheless, if the KLCI should fall with increasing volume, it usually suggests that the selling pressure was high.

As circled at C, the Stochastic breaks below 30%, entering the short term bearish territory, and therefore, the short term movement of the KLCI is expected to be weak, until the Stochastic should break above 30% level.

The re-expansion of the Bollinger Bands suggested a beginning of a new movement, but unfortunately, with the KLCI below the Bollinger Middle Band, it shows that the new movement is on the negative side.

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