KLCI has been in correction mode for the past week. The index hit the upper Bollinger band and has now pulled to the lower boundary. It looks set for a rebound on 26 Jan but the bulls could not overcome the selling pressure. With the Dow Jones dropping more than 100 points on Friday, the index should drop below the lower boundary soon.
The force index is also showing that the bears are having the upper hand. Buying could only start when the force index goes above the zero line. The MACD indicator is way below its signal line, giving more reasons for traders to go for a short position. The RSI rebounded from the oversold region but it did not manage to go above the 50% line. This is also a negative sign.
All in, the index is likely to go lower next week.