After a wave of optimism sparked by the monetary policy, the NEPSE index declined by 35.09 points on Monday, closing at 2725.71. Analysts interpret this drop as a possible technical reversal.

The monetary policy announced by Nepal Rastra Bank on Sunday was seen as investor-friendly, leading to a bullish response. However, many investors took the opportunity to book profits, following the classic “buy the rumor, sell the news” strategy, which triggered selling pressure.

According to technical analysts, the market formed a Shooting Star candle on Sunday—a typical sign of trend reversal. On Monday, the gap-up opening was filled and the index closed below Sunday’s support, confirming the weakness.

Trading volume also declined significantly—from NPR 11.35 billion on Sunday to NPR 8.17 billion on Monday.

Out of 13 sub-indices, 11 ended in the red. The banking sector saw the biggest drop at 2.46%, followed by development banks, finance, life and non-life insurance, microfinance, investment, and others, with losses between 1%–1.5%.

Among individual stocks, Mai Khola Hydropower gained the most (+5.90%), while Samudayik Laghubitta was the worst performer (-4.46%). On the trading volume side, NRN Infrastructure led the day with NPR 408 million in turnover, followed by Butwal Power and Sanima Bank.

Among the top 10 brokers by trading volume, 6 were net sellers on Monday, leading to accusations that broker activity intensified the market's decline.

From a technical standpoint, NEPSE failed to hold above the resistance of 2750 and fell back inside the previous range of 2600–2750. This signals a rejection at resistance, potentially marking the beginning of a new downswing. Investors are advised to avoid short-term speculation and focus on long-term strategies.