Inverted Hammer Candle Reappears as Major Investors Actively Buy Amid Uncertain Market Sentiment

Despite tax-related pressure due to the approaching fiscal year-end, major investors appear to be actively accumulating stocks. On Tuesday, another Inverted Hammer candle formed on the NEPSE chart, signaling a potential bullish reversal. However, like the recent series of positive candles, this too lacks confirmation, suggesting continued uncertainty in market direction.

The NEPSE index fell slightly by 0.22 points to close at 2,600.53. Total trading turnover also declined, dropping from around NPR 6.5 billion on Monday to NPR 5.76 billion on Tuesday. A total of 138.18 million shares of 316 listed stocks were traded in 62,755 transactions.

From a technical standpoint, although Tuesday's intraday high broke above Monday’s spinning top candle, the close was below that level, invalidating the bullish signal. The newly formed inverted hammer does indicate potential strength, but without follow-through, market direction remains indecisive.

In terms of sector movement, Hydropower stocks saw high supply pressure in the final hour of trading. Hydropower’s share in total turnover dropped to 61%, while the Investment sector’s turnover share doubled to 9.5%, reflecting a strategic rotation by investors booking profits in hydro and shifting focus.

The 15-minute average weighted index dropped by 1 point at closing, showing persistent end-of-day selling pressure. Meanwhile, the RSI stands at 36.24, nearing the oversold zone—indicating possible short-term recovery but no strong confirmation of an upward trend.

Broker Activity: Large Investors Buying Aggressively

Analysis of broker data shows that among the top 10 brokers, 7 had more buy-side trades than sell-side, indicating that institutional or large investors are accumulating. Broker No. 58 recorded the highest turnover of NPR 908.5 million, with NPR 490 million in buys and NPR 410 million in sells. Similarly, Broker No. 34 recorded NPR 200 million in buys and NPR 190 million in sells, while Broker No. 56 had NPR 160 million in buys and NPR 190 million in sells.

This pattern shows that major investors are taking positions while prices are consolidating. However, the overall market still lacks strong direction, and the continuously shrinking turnover reflects cautious investor sentiment.

Although some technical indicators and buying interest from major brokers offer a hint of optimism, the NEPSE index is yet to confirm a solid short-term uptrend. Strategic and cautious investment remains key in the current scenario.