Nepal stock market fell sharply today, with the NEPSE index dropping 45.36 points to close at 2,559.59. All 13 sub-sectors declined. Trading was active, with shares of 335 companies exchanging a total of 13.7 million units worth 5.76 billion rupees. Nepal Reinsurance recorded the highest trading volume.
Despite the overall drop, 18 companies saw their share prices rise. The top gainers included Aatmabir Laghubitta, Three Star Hydropower, Ween Nepal Laghubitta, and Samaj Laghubitta.
Technical indicators show a bearish trend. Candlestick patterns indicate continued selling. Bollinger Bands suggest high market volatility, as the market tested the lower band and the distance between the upper and lower bands widened. MACD shows a bearish crossover, the histogram is negative and extending, and RSI is near the oversold zone. These signs point to ongoing selling pressure.
However, the Money Flow Index shows a potential positive signal. Analysts have observed a bullish divergence forming. This happens when the price forms lower lows but the money flow forms higher lows and higher highs, suggesting that some investors are buying at lower prices.
This situation may allow the market to regain liquidity. Weak investors may sell, while patient investors may accumulate shares at cheaper rates. This process, called a liquidity sweep or false breakout, could lead the market to rise again. The next few trading sessions will show whether the market can recover.
