After rebounding from the Bollinger Middle Band, the KLCI gained another 4.32 points or 0.3% on Tuesday, to close at 1337.67 points. Support for the KLCI is at 1325 WinChart Automatic Fibonacci Retracement while the resistance is at 1350.

As shown on the chart above, the Bollinger Bands contracted 16%, suggesting that the KLCI is still consolidating, and the Bollinger Middle Band is still serving as the dynamic support, and the immediate technical outlook is still on the positive side. Meanwhile, the 14, 21, 31 EMA is also serving as a dynamic support for the KLCI.

As indicated by B, total market volume increased 32.7%, with volume above the 40-day VMA level. This suggests that the overall market participation is now improving. Generally, if volume should stay firmly above the 40-day VMA level, the market sentiment is expected to improve.

As indicated by C, the Stochastic rebound and remains above 70%, thus the short term bullish signal remains intact. Generally, the short term movement of the KLCI is likely to stay positive until the Stochastic should break below 70%.

In conclusion, the immediate technical outlook for the KLCI is still positive as it is supported by the Bollinger Middle Band, as well as the 14, 21, 31 EMA. However, the Bollinger Bands has not expanded, thus the KLCI is still consolidating.

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