As indicated by A, the KLCI gap down on Tuesday, breaking below the 1566 support, losing 14.01 points or 0.89% to close at 1561.07 points. Meanwhile, as illustrated by the L1 line, the KLCI has formed lower-highs, and the immediate technical outlook for the KLCI is negative. Next support for the KLCI is at 1500.

As indicated by B, total market volume increased 14.66%, but still below the 40-day Volume Moving Average. Overall, the market is still lightly participated. In addition to that, profit taking was dominant on Tuesday as losers outnumbered gainers by 3.7 times (with 658 losers over 176 gainers). The market sentiment for now is still weak.

As indicated by C, the Stochastic breaks below 30%, entering the short-term bearish territory. If the Stochastic should stay below 30%, the short-term movement of the KLCI is expected to be bearish biased.

In conclusion, the KLCI first formed lower-highs, and now breaking below its support, and therefore, it has fulfilled the characteristic of a downtrend formation. The KLCI also formed a Head and Shoulders Top, which suggests an bearish reversal signal for the KLCI. Technical outlook for the KLCI is negative for now, unless the KLCI could immediately return to above 1566, then it would have another chance to consolidate. Nonetheless, no one knows how long this newly formed downtrend will last, but as long as it should repeat forming lower-highs and breaking the next support of 1500, the downtrend is still intact, and many individual counters performance will be affected.