As indicated by A, the KLCI had its intra-day high reaching 1589.93 points, but as profit taking set in, the KLCI started to retreat and closed with a loss of 0.53 of a point. However, with the KLCI above the 14, 21, 31 EMA dynamic support as well as the L1 uptrend line, the uptrend of the KLCI remains intact.

As indicated by B, total market volume fell 9.1%, and as a result, volume is still below the 40-day Volume Moving Average. This suggests that the market is still quiet and investors confidence is still low.

As indicated by C, the Stochastic started falling on Monday, as the KLCI started to retreat. However, it is still staying above 70%, in the short term bullish territory. This suggests that the short term movement of the KLCI is still on the positive side.

In conclusion, after breaking new high, it is normal for the KLCI to have some correction. Provided that the KLCI is still supported by the 14, 21, 31 EMA as well as the L1 uptrend line, the current technical outlook for the KLCI remains positive. However, the main concern is still the low volume of the market.

Find this analysis useful? Why not share it with others? Click Here to send this to a friend

Straits Index (M) Sdn Bhd
No. 16, Jalan LP 1A / 5, Lestari Perdana,
43300 Seri Kembangan, Selangor
Hotline: (03) 8941 6828  (5 lines)   Fax: (03) 8941 9828
Email: info@straitsindex.com
© Copyright 1997-2010 Straits Index (M) Sdn Bhd All rights reserved