As indicated by A, the FBM KLCI had another sharp fall on Tuesday, losing 18.08 points or 1.17%, to close at 1525.92 point. The KLCI is testing the 14, 21, 31 EMA, while closing slightly below the 14, 21, 31 EMA. It is now testing the 1525 WinChart Automatic Fibonacci Retracement precisely, and if the KLCI should break below 1525 WinChart Automatic Fibonacci Retracement, the next support for the KLCI is seen at 1513 WinChart Automatic Fibonacci Retracement.

As indicated by B, total market volume fell 26%, and as a result, volume is now below the 40-day Volume Moving Average. Generally, this suggests that the market is back to quiet, and if market volume should remain below the 40-day Volume Moving Average, the KLCI is less likely to pickup its strength, or the market sentiment overall would turn weaker.

As indicated by C, the Stochastic fell below 50% and 30%, entering the short term bearish territory. This suggests that the KLCI short term movement is now turning weaker. If the Stochastic should stay below 30%, the market technical outlook for the short term is likely to stay weak.

In conclusion, after falling sharply for 2 days, the KLCI is risking losing the dynamic support of the 14, 21, 31 EMA, thus the technical outlook is now on turning weaker. However, it is still too soon to call for any bearish reversal, for the KLCI has to form a lower-high first, in order to show its early sign of a downtrend formation.

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