NEPSE Breaks Psychological Barrier: Crosses 3000 Mark, Strong Technical Signals, Institutional Buying Surge

The Nepali stock market has finally breached the psychological resistance of 3000 points on Tuesday, reaching a new height. NEPSE index climbed by 30.76 points to close at 3002.7—its highest in 52 weeks. On Sunday, the index had reached 3013 intraday but corrected back to 2964 by the close. However, Tuesday's session saw a strong upward move, closing above 3000 after peaking at 3028 intraday.

Technical analysts suggest that NEPSE's resistance zone lies between 3000–3050 points. If this level is broken, the next major resistance is projected around 3180–3230 points. On the downside, support is seen near 2750–2800. Compared to the previous bull trend, the current rally has crossed significant levels in a short time, implying further upside potential.

Many investors are optimistic that NEPSE could reach 3050 within the month of Shrawan and potentially hit 3200 afterward. Apart from technicals, supportive government policies, NRB’s monetary policy, improved liquidity, and low interest rates are driving this rally.

NRB's new policy has lowered the credit risk weight to 100% and increased the loan limit against shares to NPR 250 million. This, combined with interest rates below 8% and CD ratio around 75%, indicates ample investable liquidity in banks—over NPR 900 billion. As fixed deposit returns are low, investors are shifting toward the stock market in search of better returns.

In essence, this rally is fueled by a combination of strategic, economic, and psychological factors. The correction was short-lived, and the resistance test, policy support, and favorable financial indicators are aligning to support a potential new bull trend. If the index can hold above resistance, it may signal the start of a historic breakout.

Technical Analysis

According to technical analyst Ajit Khanal, Tuesday's market provided a crucial bullish signal. The market opened with a gap-up, invalidating the previous day’s bearish hanging man candle. NEPSE closed above Monday’s high, negating the negative sentiment and establishing a bullish stance.

Today’s strong closing suggests the next technical target is 3048. NEPSE has maintained a solid base above 3000, increasing the likelihood of further upside. Despite a slight dip in turnover, the market remains strong. Heavy buying from the banking and hydropower sectors after 2:30 PM helped the index, although the last 5 minutes saw some institutional selling in banks. This may cause short-term volatility but is not expected to hurt the broader trend.

Banking sector contributed 15% of total trades today—second highest among sectors. Among ten major banks, seven saw buying dominance, reinforcing the bullish trend.

Gap-up opening, candle invalidation, close above 3000, and active banking/hydro sectors are all strong technical indicators. If NEPSE crosses 3048, the next likely target is around 3180. Optimism is returning, and momentum suggests more highs ahead.

Broker Analysis

Today, large brokers increased their buying pressure. Among the top 10 brokers, 8 had higher buy than sell volumes. Only two had more selling. Broker no. 58 executed trades worth over NPR 3 billion, with NPR 1.46 billion in buys and NPR 1.56 billion in sells.

Stocks like GBL, Sanima, and First Micro were heavily accumulated by brokers 58, 44, and 58 respectively—indicating strong institutional interest and bullish sentiment.