On Monday, the KLCI opened lower, and had its early rebound. However, due to the strong selling pressure on blue chips, and as indicated by A, the KLCI could only fluctuate near the 1625 level, and at the end, closed at 1623.31 points, losing 5.97 point. The 14, 21, 31 EMA as shown on the chart above is serving as the dynamic resistance while the next resistance is at 1680. Support for the KLCI is at 1600, the important psychological level.

As indicated by B, total market volume remains below the 40-day Volume Moving Average. This suggests that investors confidence is still weak as the market mood is generally cautious. Meanwhile, losers still outnumbered gainers on Monday, with 378 losers vs 280 gainers. This shows that selling pressure is, overall, still high.

As indicated by C, the Stochastic stays below 10%, which suggests that the short-term movement of the KLCI is indeed very weak. At the same time, this is also a signal suggesting a short-term over-sold condition. Nevertheless, if the Stochastic should rebound and breaks above 30%, it would be a signal suggesting a beginning of a technical rebound.

In conclusion, the KLCI is now falling for the 10^th days, and despite most Asian market rebounded on Monday, the KLCI is still stuck in its short-term negative movement. But, technically, the KLCI is only in its correction stage, and we have not seen any formation of a bearish market.