As indicated by A, the KLCI rebounded on Tuesday, after the over-sold condition. The KLCI regained 32.4 points or 2.43%. Support for the KLCI is at 1300~1310 level while the resistance is at 1400 psychological level. Meanwhile, the 14, 21, 31 EMA is still serving as the dynamic resistance to the KLCI.

As indicated by B, despite the strong rebound on Tuesday, total market volume decreased 13.13%, with volume below the 40-day volume moving average. This suggests that there are no sign of strong inflow of capital, and the market sentiment is not yet showing sign of recovery.

As indicated by C, the Stochastic breaks above 30%, triggering a short term technical rebound signal for the KLCI. If the Stochastic could also break above 70%, it would be a short term bullish signal for the KLCI.

In conclusion, despite the strong rebound on Tuesday, the downtrend of the KLCI remains intact, and as long as the KLCI is still resisted by the 14, 21, 31 EMA dynamic resistance, the technical outlook for the KLCI is still negative.

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