Looking at the monthly chart below, we can see 3 Head-and-Shoulder formations in the past 20 years. The first one was in 1996-1997; the second one in 2006-2008; and the current one which spans 2 years- from mid-2013 to now. In the past, the breakdown of the neckline of the Head-and-Shoulder formation was accompanied by the 10-month SMA line cutting below the 20 & 30-month EMA line; the MACD going into negative territory; and the Slow Stochastic staying deep within the oversold zone. We can see that currently the 10-month SMA line has cut below the 20-month EMA line; the MACDis poised to enter the negative territory; and the Slow Stochastic has entered the oversold zone.
If we assume that the downside of the market to be 1 time the distance between the neckline and the top of the "head", then the target for the downtrend is about 1480. In 1997-1998, the downtrend was attenuated by the Asian Crisis and political problem. If similar problems also present themselves in the current downtrend, then it is possible that the index may test the long-term uptrend line at 1200.
Chart: FBMKLCI's monthly chart as at Aug 10, 2015_10.00am (Source: ShareInvestor)