On Thursday, the KLCI opened lower and was traded in narrow range, until late in the afternoon session, the KLCI was lifted mostly by PPB Group and Tenaga Nasional. As a result, the KLCI rose 5.5 points or 0.35%, closing at 1580.67 points. As indicated by A, the KLCI is breaking marginally above the L1 line, while the support is still at 1566-1570. Resistance for the KLCI is at 1590 – 1610.

As indicated by B, total market volume increased 34.16%, and for the first time touching the 40-day Volume Moving Average since 19 of April. This is partly due to the first day heavy trading of Globaltec Formation Berhad, which is accounted for roughly 11% of the total market volume. Nevertheless, if volume should continue to increase while staying above the 40-day Volume Moving Average, it would help lifting the market sentiment a little.

As indicated by C, the MACD positive signal is still intact, and this signal shall remains effective until the MACD histogram should form a Rounding Top, which would then suggest a consolidation or correction signal of the KLCI.

In conclusion, the breakout above the L1 line is yet to be confirmed. But nevertheless, the recent rebound of the KLCI has improved the market sentiment a little, and if the KLCI could form any consolidation patterns like Triangles, is would temporary avoid the extension of the downtrend. As for whether the KLCI could resume its uptrend, it is still too early to tell.