KLCI was still on technical correction last week, KLCI loss 12.49 points or 1.3%. KLCI fell below the 918 Fibonacci Retracement, but it was supported by the T2 ascending trend line (refer to A). The T2 is the bottom of the T1-T2 trend channel, if KLCI fall below the T2 trend line, KLCI would be breaking away from the up trend channel since August last year.

KLCI broke below the Bollinger Middle Band (BMB), unfortunately Bollinger Band also expanding / widening this week, this triggered the KLCI's dip last week. If BB able to contract or narrow, KLCI would sideways instead of continue to decline.

Technical Indicators

Volume
As pointed by B, volume traded in Bursa Malaysia still above 40 days Volume Moving Average (VMA), this indicates the market sentiments is still active.

MACD
As circled by C, MACD's Oscillator (OSC) continue to decline in the negative plane, there for KLCI correction continues. Normally the correction ends when OSC form the opposite round bottom.

RSI
RSI declined slowly last week, but yet to break below the 50% level, in addition if RSI break below 30%, KLCI would entered into mid term bearish mode.

STC
STC still below 30% mark, the short term bearish region, there for KLCI is consider in short term bearish mode. KLCI have to break out the 30% mark in order to break away from short term bearish.

In a nut shell
The trading days are limited in the following two weeks due to long holidays, normally this will lead to a quiet market. However it is traditionally a quite active trading during the Chinese New Year festival, anywhere KLCI will have to break above the BMB before KLCI have chanse to soar.

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