116 Billion Rupees Wiped Out In Matter Of A Week (Weekly Summary Of NEPSE With Technical Analysis, Sector Comparison And Major Highlights)

Fri, May 6, 2022 4:04 PM on Stock Market, Weekly Analysis, Latest,

-ShareSansar

Part 1: Rundown and Technical Analysis

The market was open only for 3 trading days this week. NEPSE remained closed on Sunday and Tuesday on the occasion of Labor Day and Eid-al Fitr. The market is closed on Fridays and Saturdays every week.

The NEPSE index closed at 2,238.63 this week after a loss of 117.54 points (-4.99%). The index had closed at 2,356.17 last week with a gain of 1.32% from the week before that.

This week, the index went as high as 2,359.27 and as low as 2,226.61 hence witnessing volatility of 132.66 points. In the previous week, the index had seen volatility of 112.44 points.

Analysis of Trend

Trend analysis is a method of Technical Analysis that helps in predicting the future movement that is based on the current ongoing trend data. Looking at the daily charts, the trend of the NEPSE index is in a downtrend. The index closed at 16 months low.

Candlestick Charting and Volume

On the weekly candlestick chart, this week's market movement has formed a long red candle with comparable no shadows on both sides. Last week, the candlestick on the weekly chart was an inverted hammer with a long upper shadow.

On the daily candlestick chart, four long red candles were formed with the highest intraday loss was 48.73 points on Tuesday.

Volume was the highest on Thursday when the index lost 37.07 points. The average turnover is 1.44 Araba for this week.

Momentum Indicators

The relative strength index (RSI) is a momentum indicator used in technical analysis that measures the magnitude of recent price changes to evaluate overbought or oversold conditions in the price of a stock or index. Traditional interpretation and usage of the RSI are that values of 70 or above indicate that a security is becoming overbought or overvalued and may be primed for a trend reversal or corrective pullback in price. An RSI reading of 30 or below indicates an oversold or undervalued condition.

The RSI reading on the daily timeframe is 28.37. Meanwhile, the RSI reading on the weekly chart is 33.50.

On the other side of things, the MACD line is still negative, i.e. below zero in the daily timeframe, with the MACD reading at -69.26, a gradual decline throughout the week. The MACD line is below the signal line.

Price Action

The Indexed followed the trend and continuously fall this week. The index breaks the support of the 2280 level and closed below its support level.

The index penetrated below the 0.786 Fibonacci level drawn between the two most-recent significant pivot extremes on the daily candlestick chart. Although some technical analysts put too much emphasis on these retracement zones, the analyst at hand prefers to adhere to this quote:

"Anticipating retracement levels can be somewhat hazardous, and the trade-off between the amount of retracement desired and what may actually occur is usually unanticipated. Thus, a rough estimate from previous retracements, support and resistance zones, and the location of the longer trend line is probably the best information for an estimate rather than the mechanical percentage numbers derived from various formulas."

The 2,100 to 2,115 zone may act as the nearest support.

Part 2: Insight into Important Data

More than 1.25 crores unit shares worth Rs. 4.34 Arba have been traded through 93.23 thousands transactions this week. The current market capitalization of NEPSE stands at Rs. 3,184,769.52 million.

**NEPSE index and Sub-indices performance: (Decline is based on previous week's close)**

The NEPSE index declined by 4.99% this week. All the sectors lost this week.

Stocks with the highest monthly Beta (Hydropower)

The top 3 companies with the highest beta are Panchakanya Mai Hydropower Limited (PMHPL), Ghalemdi Hydro Limited (GHL), Union Hydropower Company Limited (UNHPL) with 2.27, 2.16, 2.15 respectively.

Top Ten Gainers of the week:

Jalpa Samudayik Laghubitta Bittiya Sanstha Limited (JALPA) is the top gainer this week. JALPA closed at Rs. 1,520 with Rs. 378 (33.08%) increment.

All the analysis is done with the SS Pro Software. To know more about the software, click on the link below

SSpro

Top Ten Losers of the week:

Nepal Finance Limited's (NFS) price has decreased by 41.57% and its LTP stands at Rs. 298. Note that 70% Right share book closure adjustment led to fall in price of NFS.

Top Stocks by Turnover, Volume, and Number of Transaction:

Arun Valley Hydropower Development Company Limited (AHPC) is the top traded company of the week. A total of Rs. 13.45 crores worth of AHPC shares were traded this week.