On Thursday, the KLCI continue its technical rebound, gaining another 5.22 points or 0.36%. As indicated by A, the KLCI is about to test the 14, 21, 31 EMA dynamic resistance as well as the 1480 resistance, while the support remains at 1423 WinChart automatic Fibonacci retracement.

As indicated by B, total market volume increased 24.98%, suggesting some improvement of market participation. However, total market volume is still below the 40-day volume moving average, and this suggests that the market participation is still not sufficient, as the confidence of investors is still low.

As indicated by C, the Stochastic is still rising. If the Stochastic should break above and stay above 70%, the short term movement of the KLCI is likely to improve.

In conclusion, despite a short term movement improvement, the downtrend of the KLCI is still intact. The rebound of the these two days is only a technical rebound, and not yet a reversal. Technically, the KLCI would have to break above the 14, 21, 31 EMA, then form a higher-low, in order to suggests a reversal signal.

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