High Turnover, Strong Buying from Top Brokers but Market Remains Technically Negative

On the last trading day of the week, Thursday, the NEPSE index continued its downward trend. After declining the previous day, the market extended the same trend, dropping by 9.08 points to close at 2,655.38.

Despite heavy trading in the hydropower sector, strong selling pressure in the segment dragged the market down. However, overall transaction volume saw a notable increase. On Wednesday, the total turnover was NPR 9.90 billion, whereas on Thursday, shares worth NPR 12.51 billion were traded in 102,895 transactions involving 311 companies, totaling over 28.6 million shares.

• Pure Energy hit the positive circuit level for the second consecutive day, rising NPR 74.90 to close at NPR 824.70.

• Chandragiri Hills surged by nearly 7%, while Rasuwagadhi Hydropower and Tehrathum Power increased by 5.99%.

• On the downside, Guras Laghubitta saw the biggest drop of the day, falling 9.90%.

In terms of turnover, Ngadi Group Power topped the list with over NPR 1.08 billion in trades. Sanima Mai Hydropower recorded over NPR 750 million in turnover, and Radhi Power saw about NPR 540 million worth of shares traded.

Out of 13 sub-indices, 4 gained while 9 declined. The Hotel and Tourism sub-index rose the most at 2.14%. Finance, Hydropower, and Mutual Fund sectors saw minor gains, while the Trade sub-index fell the most, down by 1.09%.

Technical Analysis

Thursday’s candle closed below the low of Wednesday’s “Tweezers Top” formation, validating the bearish pattern. The chart also formed another Lower High (LH), reinforcing the downward trend.

Both the middle Bollinger Band and 50-day Moving Average were broken. Importantly, the breakdown occurred on the highest trading volume in nearly three months, confirming the weakness.

RSI has dropped below 50, signaling weakening buying momentum. The Death Cross (short-term MA crossing below long-term MA) remains active, indicating a long-term bearish outlook.

Although the market was relatively stable throughout the day, heavy supply appeared in hydropower stocks during the final trading minutes. A concerning trend is that for several consecutive days, the last 15 minutes of trading have consistently pulled the index down by 3–4 points. This indicates sellers dominating buyers during the closing minutes — a negative signal for the market.

Broker Analysis

Among the top 10 brokers by transaction volume, 7 showed higher buying than selling, while 3 had relatively higher sell-side activity. Despite the index dropping, the strong buying interest from large brokers has led some analysts to speculate whether the market might be preparing for an upward reversal.

While high turnover and broker activity suggest underlying interest in the market, technical indicators remain clearly bearish. The breakdown of key support levels, weak RSI, and continued death cross pattern point to caution. Traders and investors are advised to remain vigilant and avoid aggressive buying until a confirmed reversal signal appears.