Nepse Weekly Technical Analysis October 11 - October 15, 2015

1. TECHNICAL ANALYSIS
1. Market Summary (as of October 15, 2015)
NEPSE at close last week (October 15, 2015) 1134.47
NEPSE high last week (October 11, 2015) 1143.88
Weekly Change -27.59 points (or -2.39%)
Daily Volume (Avg.) NPR 39.60 crores
Total Traded Amount (weekly) NPR 118.81 crores
RSI 41.44
MACD Line -2.02
Signal Line 5.91
2. Nepse Figure
Nepse (June 1, 2014 – October 15, 2015)

2. 3. Trend Analysis
The Nepse index ended in the red throughout last week. The market lost 18.18 points (or 1.56%) at the
beginning of the week. It seems that bearish sentiment looms over the market as the current oil crisis does not
seem to improve. As the fuel crisis remains uncertain, the market will remain bearish as economy has been
hurt due to the crisis.
4. Resistance and Support
Immediate Support 1112
Support 2 1083
Immediate Resistance 1183
Resistance 2 1205
The benchmark index crossed below the immediate support level of 1149 at the beginning of last week.
The lowest Nepse went down to last week was at 1134.47. Due to the bearish sentiments at the market,
the index could fall further. Hence, its immediate support level now stands at 1112.05 and resistance level
stands at 1183.
5. Trend Indicator
a.) MACD
The MACD is a momentum oscillator formed by using two different types of moving averages, which
provides specific buying or selling signals. When a MACD line crosses above the signal line, it is
considered to be a positive sign and indicates a time to buy, and vice-versa.
The Macd line ended at the negative territory at the end of last week, indicating a bearish signal. The
signal line fell further as well. It is only a matter of time the signal line will fall into the negative territory
as well. At the end of the week the macd and signal line ended at -2.02 and 5.91 respectively.
b.) RSI
RSI is a form of leading indicator that is believed to be most effective during periods of sideways
movement. Such indicators may create numerous buy and sell signals that are useful when the market is
not clearly trending upwards or downwards.

3. The RSI declined further towards the early 40’s zone at the end of last week. It shows market to be at a
neutral stance. However, it shows that the market is gradually going towards an over-sell condition. The
RSI stood at 44.06 on Sunday (beginning of the week). In the course of the week it lost 2.16 points to
close at 41.44 level.
c.) Bollinger Bands
The Bollinger Band is a technical indicator that consists of a moving average (21-day) along with two
trading bands above (upper band) and below it (lower band). The bands are an indication of volatility,
which are represented by calculating standard deviation.
The benchmark index is touching the lower Bollinger band, indicating an over-sell condition in the
market. The upper and lower bands have shown signs of divergence, indicating a rise in the market
volatility.

4. 6. Volume Indicator (On-Balance Volume)
On-Balance Volume (OBV) is a momentum indicator that relates volume to the current price of the index
or security. It measures buying and selling pressure at the market. It acts as a cumulative indicator that
adds volume on up days and subtracts volume on down days. If a price increase is supported by OBV, it
confirms an uptrend, whereas if a price decrease is supported by OBV, it confirms a downtrend.
The OBV (On-Balance Volume) decline last week as well. The benchmark index fell further, signifying a
bearish movement in the market. The average weekly volume transactions saw a decrease from NPR 42.89
crores to NPR 39.60 crores.
7. Overview
The Nepse index decreased throughout last week. The benchmark index, lost 27.59 points (or down -2.39%)
to close at 1134.47. Volatility is still present in the market as the fuel crises has given the public a bearish
attitude. The 50-day moving average (MA) is still moving above the 200-day MA, indicating that the overall
outlook of the market looks good. The average weekly volume transactions decreased to NPR 39.60 from
NPR 42.89 week prior. The RSI closed at 41.44 level. Falling further would indicate an oversell condition in
the market. The Bollinger bands show oversell condition in the market, as the index is touching the lower
band. It has also shown signs of increase in market volatility. The new support level stands at 1112, whereas
the resistance level stands the same at 1183.

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