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The up trend rally since March, when the KLCI was about 1,200 points found heavy resistance at the 1,300 points level. The movement formed a toppish pattern called the double top or bearish reversal. It was confirmed when the KLCI broke below the double top formation neckline at 1,270 points and the tightening Bollinger Bands started to explode. The KLCI is now at 1229.35 points.
The KLCI is now slightly oversold in the short term as the Stochastic indicator has gone below the 30 level. An immediate technical rebound is expected but may face resistance at 1,250 points (which is the current down trend line support level). It is expected to continue its down trend because the momentum indicators, like RSI and MACD shows strong bearish momentum. Next support level is at 1,200 points. The 1,300 points resistance level remains the main resistance for the KLCI.
Article by Benny Lee
The KLCI is now slightly oversold in the short term as the Stochastic indicator has gone below the 30 level. An immediate technical rebound is expected but may face resistance at 1,250 points (which is the current down trend line support level). It is expected to continue its down trend because the momentum indicators, like RSI and MACD shows strong bearish momentum. Next support level is at 1,200 points. The 1,300 points resistance level remains the main resistance for the KLCI.
Article by Benny Lee
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