835 Base Building >>> Slim spark of hope (unconfirmed) for KLCI to rejoin rally

When the KLCI was hovering near the 900 level, we have been calling for it to reach the 835 level. Our call was proven right when the KLCI reached a low of 836 last week. Is it now time for the 835 level to shine?

835 Base Building
Apparently the KLCI is now building a base at the 835 support level. Could this support level be the trigger for the KLCI to rejoin the Dow rally? We will know soon if the KLCI stages a strong rally from this level or if this level can hold for a longer period of time (1-2 weeks)

KLCI-Dow correlation still dipping
The KLCI-Dow correlation continues to dip further below 0.6 to 0.5762. The dip in correlation has caused us to be wary about calling for the KLCI to rejoin the Dow’s aggressive rally.

Strategy : Bearish call maintained ; Hoping for more signs of a positive KLCI
Due to the KLCI-Dow correlation dipping further, we maintain our negative view on the KLCI. However, following the KLCI’s base building at the 835 level, we are now on full alert to detect any positive changes in the KLCI if and when they occur.