Stockology: Will markets see trend-reversal in last trading week of the year?

Stockology is a weekly column by futurologist Mahesh Gowande. He is the founder and director of Ayan Analytics which has developed ZodiacAnalyst. It is a research software, with time and price charting tools, and it is exclusively used along with technical support. 

Over the recent fortnight, there has been increased volatility in the markets. The historical data from TimeMap indicates a preference for bullish trends, and the uptrend could persist until the end of December. Venus, the second most pivotal planet for wealth creation, has exerted influence over the past 45 days. However, on the 25th, it will ingress the sign Scorpio, a sign not conducive to wealth creation, and harmonious with planet Venus.

As mentioned in our earlier write-up, swift corrective rallies or price recoveries typically occur when Venus assumes a more favourable position; this enables trapped traders to exit with minimal losses. Upward momentum is building in technology and communication-related stocks and institutional investment is noticeably increasing. Additionally, a noteworthy development is the increased stability in INR/USD, with the possibility of the rupee strengthening.

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Technical: Post-election results, the Nifty was driven by FOMO sentiment and equally by the short-covering of the hedged positions. On the upside, the high-friction zone is 21,880 – 22,001, and the possibility of burning out of the bulls is very high; the chart formation of the last 10 days has started showing exhaustion gaps, which means the reversal would be as early as before January 31, 2023.

Breaking 21,090 will signal the first sign of the trend reversal on the short-term daily chart; second confirmation of the trend reversal would be at 20,870, and the target of the downward rally would be 20,540 and 20,281; it takes not more than 30 days from the trigger of 21,090 to achieve the targets given above.

TimeMap: The presence of the Sun in Moola has yielded unexpectedly positive outcomes, and despite market volatility, long-term investors are reaping the rewards. We are positive for another week, but a positive weekly close cannot be ruled out. Indian markets are experiencing a sustained bull run, but January to March has not been a good quarter for the indices.

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Venus is entering Scorpio, and the solar date of January is deemed the most favourable among the three solar dates in the year. The upcoming 40 days from January 10 present an excellent opportunity for low-risk, high-reward trading. On the positive side, significant investment flows from major institutions are notably anticipated in the direction of media and high-end consumer product manufacturers, driven by the positioning of Rahu in Nakshatra Revati. It is expected that a pleasant surprise will emerge, with the media sector producing a multibagger.

The other side is the rise witnessed after the election, which has stretched the valuation to historically expensive valuations, which typically do not sustain for long.

Sun transit in the sign of Sagittarius – ruled by Jupiter – is Lord of Expansion, aggression, transparency, and confidence, time zone from December 15 to January 14.  Typically, markets around the world do well, and wealth creation happens during this zone. Sign of euphoric momentum, excessive indulgence ultimately make it vulnerable. Momentum indicators give the best results during this time-zone; further optimisations can be applied.

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The ambush zone, identified by TimeMap, spans from January 14 to February 15, coinciding with the SUN’s transit through the Capricorn sign. Planet Saturn rules the sign Capricorn, with few qualities of contraction, slowness, mystery, and a play-safe attitude.  Although the Crocodile symbolises the Capricorn, it aligns seamlessly with the characteristics of a Successful short seller, often referred to as a bear operator in capital markets. It is mentioned earlier and above that this is the best low-risk and high-reward zone. Failure pattern & trend reversal Indicators give the best results.

The Nature exhibits a sequence and pattern, playing a crucial role in the interconnected web of existence. Evolved humans, as integral components of this natural chain, demonstrate heightened responsiveness to its vibrations in investment and trading activities. Our Humanistic AI is designed to track and map these nuances, extracting optimal insights and profit from the human emotional volatility.

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December 26, 2023: Tuesday: Pournima: Mrugga: Profit-Booking Day

Markets are likely to open on a positive note. Influence of the Moon Nakshatra Mrugga would spotlight the Technology sector and select communication stocks. Swift action is the key winning card of the day; traders who can act fast will make big money. The trend is a friend theme today, which would be rewarding. STBT (sell today, buy tomorrow) is recommended.

December 27, 2023: Wednesday: K.1: Aardra: Good Day

Ideally, a lower opening of indices and a minor selling in select counters could put day traders on the back foot. Sluggish opening with low participation before 11 am and post 11.45 inflow of large orders would charge markets by the end of the big positive cannot be ruled out in many individual stocks. Overall positive view for the day. Delayed participation would be more beneficial for the traders. Consolidation trend Breakout indicators will give better results. BTST (buy today, sell tomorrow) is highly recommended in oversold reversing stocks.

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December 28, 2023: Thursday: K.2: Punervasu: Auspicious Day

Tithi gives a nice corrective move, and Nakshatra Punervasu is best for the turnaround of positive stories. Reversal indicators provide the best results. Looking at PSU banks is highly recommended. Today is an auspicious day; investors should do SIP and bulk investment, and the possibility of a negative closing is very bright. BTST recommended.

December 29, 2023: Friday: K.3: Pushya: Bad day

A higher opening is expected. Day traders start slow and look for a consolidation breakout indicator and be with the trend. Tithi gives wide trended move, so negative or positive generally it is more than 0.5 percent. Overall weekly influence is positive, and markets will remain positive.