Will NEPSE Go on a Correction? Will the Trend Continue? Detailed Weekly Summary and Highlights (with Technical Analysis)

Fri, Jan 29, 2021 12:57 PM on Stock Market, Weekly Analysis, Exclusive,

-ShareSansar

65.54 points volatility was witnessed this week, with the market reaching the highest 2462.28 and the lowest 2396.74. NEPSE index gained 50.65 points (2.13%) in this trading week. Last Week market closed at 2374.64 points and this week closed at 2425.29 points on Thursday.

Pattern Analysis:

The bullish flag pattern is formed. The base of the flag is formed in 1635 and the top of the flag is 2090. The overall height of the flag is 455. The target will be 2550.

Candlestick pattern:

Two green candles and three red candles were formed this week. A long bearish candle was formed on the last trading day.

Exponential Moving Average:

We have used EMA's of 5 days' time period (blue line), 20 days' time period (red line). At present, NEPSE index is above both 5 days EMA and 20 days EMA. Values above moving average signals for bullishness. The golden cross signal was generated by moving average on the 18th of October 2020.

Relative Strength Index:

Relative Strength Index is a momentum oscillator that measures between zero and 100. Currently, the Relative Strength Index is at 77.16 level. Traditionally the RSI is considered overbought when above 70 and oversold when below 30. A bearish divergence is seen in RSI as the index is making higher highs but RSI is making lower highs.

Moving Average Convergence and Divergence:

MACD line (blue) and the signal line (red line) are in the Positive zone. The signal line has crossed the MACD line, this indicates a bullish signal. A histogram is also in the positive zone. Overall MACD is indicating upward momentum.

Fibonacci retracement:

A Fibonacci retracement refers to areas of support or resistance. The indicator is useful because it can be drawn between any two significant price points, such as a high and a low, and then the indicator will create the levels between those two points.

The Fibonacci retracement levels are

100% - 1888

1.272% - 2108

1.618% - 2383

2.618% - 3179

Turnover

Support and resistance level for the next trading week according to Pivot Point.

Pivot Point- 2427 point

1^st Resistance- 2459 point 1^st Support- 2393 point

2^nd Resistance- 2493 point 2^nd Support- 2361 point

3^rd Resistance- 2526 point 3^rd Support- 2328 point

Conclusion: All major indicators are supporting market momentum to be less volatile in upcoming days.

Listing of the week:

Weekly Market Summary of NEPSE:

More than 9.57 crore unit shares of worth Rs 44.46 Arba has been traded through 3.57 lakh transactions this week. The current market capitalization of NEPSE stands at Rs. 3,266,758.24 Million.

Sector-wise breakdown of the turnover of this week:

The commercial bank's sector made 27.09% of the total turnover this week followed by the Life Insurance sector with 17.12% of the total turnover.

NEPSE index and Sub-indices performance: (Increment here is based on the previous week closed value)

The NEPSE index increased by 2.13% this week. The top gainer sector of this week is the Non-Life Insurance sector with a rise of 9.40%.

Stock with the highest monthly Beta value from the Microfinance, Insurance & Hydropower

Prime Commercial Bank Limited (PCBL) has the highest monthly Beta value of 2.40 followed by Kumari Bank Limited (KBL) and Everest Bank Limited (EBL) with 2.25 and 2.17 beta value respectively.

Top Ten Gainers of the week:

Prabhu Life Insurance Company Limited (PLI) is the top gainer of this week. Prabhu Life closed at Rs 695 with Rs 262 (60.51%) 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:

Progressive Finance Limited (PROFL) is the top looser of this week. NLIC, GBBL and CFCL price fell due to their 31%, 13.5% and 7% bonus share adjustment.

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

Nepal Life Insurance Company Limited (NLIC) is the top traded company of the week. A total of Rs 4.23 Arba worth of NLIC shares were traded this week.