Weekly Technical Analysis of NEPSE index: Market may be sluggish next week

This week Nepse Index closed at the lowest point of the month. Index opened at 1191.07 points and closed at 1157.88 points with the loss of 33.19 points (2.86%). On Sunday the index was down by 12.61 points to sit at 1178.46. The market slipped down further on Monday by 9.55 points.  Tuesday also index lost 2.24 points. Wednesday and Thursday index fell by 3.46 and 5.33 points.

nepse chart 13 sep

Candlestick pattern:

Bearish candles were formed in all trading days of this week. First 2 trading days, long bearish candle and small bearish candle in rest of trading day were formed.

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 below both 5 days EMA and 20 days EMA. Value below moving average usually is bearish signal. Dead cross signal generated by moving average on 29th of July,2019 is still valid.

Relative Strength Index:

Relative Strength Index is currently at over sold zone, 25.

Moving Average Convergence and Divergence:

MACD line (blue) and the signal line (red line) are in negative zone. Histogram is also in negative zone which shows market could fall further in upcoming days.

Fibonacci retracement method:

Nepse Index is trading between 61.8% and 78.6 % Fibonacci level, 1194 is 61.8% whereas 1152 is 78.6% Fibonacci level.

This week’s market statistics:

Index Open-1191.07 points                Index closed-1157.88 points               

Index High– 1192.33 points                Index low– 1156.37 points

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

Pivot Point- 1168 point

1st Resistance-1180 point                1st support-1144 point

2nd Resistance-1204 point               2nd support-1132 point

Conclusion: All major indicators are supporting down trend. We can aspect market to make new low next week.

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