Is NEPSE breaking out or correcting? Index at 2712.86 (+8.78 pts). 29/349 MACD above zero, breadth 0.95 A/D ratio. Breakout and correction signals analyzed.
Breakout or Correction? — 2026-05-05
NEPSE closed at 2712.86, up +8.78 points (+0.32%) from the previous close of 2704.08. The index traded between 2684.62 (low) and 2726.18 (high), opening at 2701.22.
Is today's NEPSE action a sign of breakout momentum or a correction? Let's analyze the evidence.
Breakout Signals
- More losers (19) than gainers (18) — bearish breadth
- Only 6/18 MACD above zero — weak momentum
- More bullish (2) than bearish (0) MACD crosses
- Top gainer ULHC has strong volume (43,589)
Correction Signals
- Limited bearish divergence
- 9 expanding — momentum intact
- Gaining sector is broader
Key Levels
- ULHC: Support Rs. 476, Resistance Rs. 550
- SOHL: Support Rs. 660, Resistance Rs. 726
- DLBS: Support Rs. 1255, Resistance Rs. 1409
Verdict
Evidence tilts toward CORRECTION — negative breadth and weak MACD suggest further downside risk.