Chart 1: FBMKLCI's daily chart as at Mar 21, 2019 (Source: Malaysiastock.biz)
As mentioned in my last market outlook piece, FBMKLCI is hanging onto the line connecting the lows (or, troughs) since 2010. I drew 2 uptrend lines (SS & S1-S1) to show how well the index is supported by these 2 uptrend lines. In 2011 & 2015, the lower uptrend line S1-S1 were tested and a strong rebound kicked in. Last year, the uptrend line S1-S1 were tested 3 times; the first test elicited a decent rebound, the 2nd test elicited a timid rebound and the last test led to a breakdown. After a 2-month struggle, the index climbed back above the lower uptrend line S1-S1 but failed to cross above the higher uptrend line, SS. Three weeks ago, it broke the lower uptrend line S1-S1 again.
Chart 2: FBMKLCI's weekly chart as at Mar 21, 2019 (Source: Malaysiastock.biz)
We have to watch how the index will fare on testing the horizontal support at 1650. If FBMKLCI were to break below the 1650 support, then it may continue to go lower. The next support will be at 1600. For the next few days, we better play it safe and watch from the sideline.