As indicated by A, the FBM KLCI rebounded 7.37 points or 0.5% on Thursday, and might be forming a Higher-Low, which is one of the characteristic of an uptrend formation. If the KLCI should later break above 1566 resistance, it could be forming an uptrend as illustrated by the dotted line. Nevertheless, resistance for the KLCI is at 1552.74 followed by 1566, while the support is at 1525.67 WinChart Automatic Fibonacci Retracement.

As indicated by B, total market volume only gained 4.2%, while still below the 40-day Volume Moving Average. This shows that the market participation is still low, as inflow of fresh capital is also low. In short, the lower volume implies that investors are still not feeling confident about the local market.

As circled at C, the Stochastic rebounded on Thursday, but not yet broken above 70%. If the Stochastic could break above 70%, it would be a short term bullish signal for the KLCI, suggesting that the short term movement of the KLCI is positive biased.

In conclusion, the KLCI not yet forming an uptrend, but only showing a sign of a possible higher-Low formation. Nevertheless, with the KLCi above the 14, 21, 31 EMA, the technical outlook is on the positive side. As for whether the KLCI could take out the 1566 resistance, or even if the KLCI should form an uptrend, the sustainability is still highly doubtful if volume should remain low.

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