KLCI In Bullish Trend

KLCI broke out of its resistance level of 1560 level and it is now at the upper channel of the Bollinger band.

The GAMMA chart is showing strong uptrend with the short term and long term groups of moving averages showing bullish trend.

This shows that both short term traders and long term investors are supporting the market.

In the short term, the market may pull back towards its 20 day moving averages.

If it does so, then it will be a good time to add into your positions.

KLCI Likely To Be In Trading Range

KLCI index rebounded off its lower Bollinger band on 28 Feb.  The index is now above its 20 day moving average and is set to test its upper Bollinger band at around 1539 level.

Technically the index looks bullish.  The MACD indicator just made a bullish crossover with its signal line.  The +DI is now above its –DI line.  However the ADX indicator is still low at current levels and that means that we do not expect a strong uptrend.   2 day RSI is reaching overbought levels and we will most likely see a pullback.  The index looks set to remain in trading range between 1476 and 1539 levels.

KLCI In Correction Mode

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.