Due to the massive sell down in the US market last Friday, the KLCI opened gaped down on Monday, losing 18.41 points or 1.17%, to close at 1555.18 points. As indicated by A, the KLCI fell below 1570 support, while remains below the L1 downtrend line. Next support for the KLCI is at 1535.

As indicated by B, total market volume is still below the 40-day Volume Moving Average, and this clearly suggests that the the market participation is indeed quiet. The lower volume is still implying a weak market sentiment as investors confidence is still low.

As circled at C, the MACD histogram stopped rising, and might be forming a Rounding Top. If the MACD histogram should continue to fall and forming Rounding Top, it means that the KLCI is losing strength again, which suggests a weakening short-term movement.

In conclusion, despite the strong rebound in the past couple weeks, the KLCI failed to break above the L1 downtrend line, suggesting that the KLCI downtrend is still intact, with negative technical oulook. Meanwhile, major markets in the Europe are already below the 200-day Moving Average, and the US is now testing the 200-day MA line. As for the Asian markets, major indices in Japan, HongKong, Shanghai, Taiwan and Singapore had already broken below their 200-MA, while the KLCI is still holding up above this level. This suggests that the KLCI has least affected by the weaker global sell down.