Volume not confirming STI's drop

A basic tenet of technical analysis is that volume must confirm price action. If the price goes up, the volume must increase otherwise, chances are that this increase in price is likely to be short-lived and vice versa. The drop in the Straits Times Index was not accompanied by heavy volume. If it was accompanied by heavy volume, it is likely to be panic selling.

We can see that STI has landed at the level of around 3630 and that was the level of the previous drop. Thus this drop is now currently acting as a support for STI. Furthermore, the close of STI is at the 50d EMA so technically speaking, i believe STI will not drop further. The closing of the Dow Jones later must also be taken in consideration since STI is following the Dow Jones closely. In my previous post, i believe Dow Jones will not drop further as it is now supported on the 100d EMA. Thus my outlook for the market is neutral now.

For the counters, i noticed there were a lot of black candlesticks formed but their volume was not heavy so it's ok. Another interesting thing was that ChinaMilk seems to be defying the trend by gaping up and closing higher but it does not appeal to me on the chart.

Straits Times Index: