As indicated by A, the KLCI retreated on Thursday, but managed to rebound from the Bollinger Middle Band, losing 4.97 points to close at 1336.05 points. Support for the KLCI remains at 1325 WinChart Automatic Fibonacci Retracement while the resistance remains at 1350 level.

As shown on the chart above, the Bollinger Bands contracted 22%, suggesting that the KLCI is indeed having a consolidation, and at the same time, preparing for a new movement, until the re-expansion of the Bollinger Bands.

As indicated by B, total market volume fell 0.2%, but still above the 40-day VMA level. This suggests that the overall market is well-participated. Generally, if volume should stay above the 40-day VMA level, the market sentiment is expected to improve.

As indicated by C, the Stochastic fell to 70% level, if the Stochastic should break below 70%, it would be an end to the short term bullishness of the KLCI, thus a signal suggesting a beginning of a technical correction.

Other than the Bollinger Middle Band, the KLCI is also supported by the 14, 21, 31 EMA, thus the immediate technical outlook is still on the positive side.

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