Is NEPSE breaking out or correcting? Index at 2711.22 (-1.64 pts). 29/350 MACD above zero, breadth 0.89 A/D ratio. Breakout and correction signals analyzed.
Breakout or Correction? — 2026-05-06
NEPSE closed at 2711.22, down -1.64 points (-0.06%) from the previous close of 2712.86. The index traded between 2705.55 (low) and 2724.27 (high), opening at 2718.07.
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 (17) — bearish breadth
- Only 3/18 MACD above zero — weak momentum
- More bullish (10) than bearish (0) MACD crosses
- Top gainer FOWAD has strong volume (21,202)
Correction Signals
- Limited bearish divergence
- 6 expanding — momentum intact
- Gaining sector is broader
Key Levels
- FOWAD: Support Rs. 1109, Resistance Rs. 1314
- ULHC: Support Rs. 499, Resistance Rs. 572.6
- NICGF2: Support Rs. 9.15, Resistance Rs. 9.78
Verdict
Evidence tilts toward CORRECTION — negative breadth and weak MACD suggest further downside risk.