As shown on the chart above, the Bollinger Bands contracted 2%, suggesting that the KLCI might be consolidating, and the direction of the KLCI is expected to be unclear until the re-expansion of the Bollinger Bands. Nevertheless, with the KLCI above the Bollinger Middle Band, the technical outlook is still positive.

As indicated by B, total market volume fell 19.3%, with volume breaking below the 40-day VMA level. Overall, market is lightly participated, as investors are staying on the sidelines while waiting for some fresh leads. Generally, it is rather normal to have lower volume as the market consolidate.

As indicated by C, the Stochastic is gradually falling but still above 70%, thus the short term bullish signal is still intact. If the Stochastic should break below 70%, it would be a signal suggesting a beginning of a technical correction.

In conclusion, although the KLCI is temporary resisted by 1436, immediate technical outlook for the KLCI is still positive, as it is still above the Bollinger Middle Band, as well as supported by the 14, 21, 31 EMA.

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