For the week ended on the 7th of October 2005, the Composite Index lost a total of 2.33 points to 925.21 points. For the entire week, KLCI was trading at a narrow range of 6.47 points.

Main Chart:
KLCI has been trading in a narrow range of 6.47 points for the past week. Support for the KLCI is still located at the 10 days Bollinger middle band dynamic support, and the next support level for KLCI would be the 921 Fibonacci Retracement. On the other hand, resistance for KLCI is found at 928.78 Fibonacci retracement.

Bollinger Bands:
For the past week, 10 days Bollinger band width was generally narrowing with the KLCI situated above the middle band. However, on Friday, KLCI closed marginally below the middle band, and as a result, the immediate outlook for KLCI has turned cautious. Nonetheless, because the band width is basically still contracting, it suggests that the volatility of KLCI is low, thus KLCI is likely to go sideways until a clear opening of the band width. (Study A)

Total market volume for the week was at 20.67 million lots, which was 6.1% lower than last week's total market volume. On daily chart, total market volume for Tuesday, Wednesday, and Thursday was higher than the 40 days VMA level; while on Friday, volume was barely at the 40 days VMA level. Overall, market participation was considered active. (Study B)

MACD:
As pointed in the C circle, the MACD has a possible sign of changing direction and getting closer to the Trigger line. As a result, the histogram also pointed lower. This is due to the consolidation of the KLCI, and since the Bollinger band width is narrowing, significant of signals from any secondary indicators is reduced. Nonetheless, if we see the MACD line crosses below the trigger line, it suggests a sell signal for KLCI. (Study C)

WinChart RSI:
As shown in the D circle, WinChart RSI has failed to hold up above the 70% level. From the reading of the WinChart RSI, it appears that the KLCI is not showing any bullish strength; but however, since the WinChart RSI is still above the 50% level, it suggests that the market sentiment is neutral with a slight bullish bias. (Study D)

Stochastic:
Ever since dropping below the 70% level on Monday, %D of the Stochastic has shown that the short-term bullishness has ended. At this moment, %K has dropped slightly below the 50% level suggesting that the short-term market sentiment is at neutral. (Study E)

In the Nut Shell:
In conjunction with the consolidation of KLCI, indicators readings are neutral. At this moment, market direction is unclear and during this consolidation phase, it is a good idea to study the Bollinger bands over other secondary indicators for during a sideways market, accuracy of signals from secondary indicators are slightly reduced.

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