Stockology: FMCG, MNC pharma, technology and textile stocks showing positive signals

Small-cap and midcap quality stocks with stable performance are being confidently accumulated, suggesting that the years 2026-2027 may see increased merger and acquisition activity in Indian capital markets.

Stockology is a weekly column by futurologist Mahesh Gowande. He is the Founder and Director of Ayan Analytics, which has developed ZodiacAnalyst, a research software with time and price charting tools.

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Review of the Last Week

As far as data-backed forecasting is concerned, it was a disastrous week for us. Monday and Thursday's negative trends were surely expected, but the unexpected negative movements on Wednesday and Friday took us by surprise and momentarily shook our confidence. The harsh truth is that when data indicates extreme optimism, it is time to be cautious. We anticipated wide volatility during the current week, followed by a directional move in the next or the upcoming week. Broad markets crashed, and blue-chip stocks, which had shown signs of bottoming out, hit new lows, significantly impacting the index chart.

In the December 17th daily write-up, we anticipated a fall, particularly in FMCG, expecting it to hit new lows. We recommended contrarian investments against the trend or small SIPs, suggesting it was an auspicious day. However, the markets neither stopped nor reversed course.

Technical

The market is notorious for either offering opportunities or trapping people on the wrong side of a trade. The Friday the 13th candle gave significant hope that the Nifty could trade above 25,000, albeit briefly, providing an exit opportunity for trapped bulls. The directional fall over five days, amounting to 1,180 Nifty points, dashed the hopes of many. While this was technically not surprising, as 24,750 was a very strong supply zone, the aggression shown by sellers has now created fear. We had expected a nominal rise, with the 19th being an auspicious day to short, triggering a sell-off.

Our opinion that 22,700 could be breached after January might now happen before the TimeMap projections. Breaking 23,520 could trigger another wave of panic sell-offs, with large account withdrawal applications adding further pressure on the markets. The first sign of strength would only appear above 24,500; otherwise, the theme remains "sell on rise."

Small-cap and midcap quality stocks with stable performance are being confidently accumulated, suggesting that the years 2026-2027 may see increased merger and acquisition activity in Indian capital markets. Deep-pocketed investors will likely push many small caps into the midcap space.

TimeMap

We went wrong in our forecast, as our bias was positive, recommending a bullish stance for the week, and we were 100% wrong each day. It is better to take a clear stance, even at the risk of being wrong, than to offer vague, contradictory statements and claim credit regardless of the outcome. Most analysts and chartists prefer giving mixed views, confusing investors. Regardless, we will begin our forecast for next week.

The next five days are expected to be positive from Friday's closing points. Against the 1,180-point fall, the recovery range could be a minimum of 40 percent or more. TimeMap focuses on behavioral pattern recognition—it is not about price but emotional and response mapping, which makes reading the masses’ mindset a challenging task.

As mentioned earlier, we are optimistic about the coming week, focusing on specific counters that closed above their December 5th levels, as they could be the best-performing stocks. FMCG, MNC Pharma, select technology stocks, and potentially textile industry stocks are showing positive signals for the coming days.

December 23, 2024: Monday: K-8: Hasta: Auspicious Day

The Tithi suggests bottoming out or ending a trend, while the Nakshatra is ideal for slow and steady investments. Patience pays, especially under the influence of Hasta. Investment and BTST (Buy Today, Sell Tomorrow) are recommended. Aggressive yet focused actions could be highly rewarding. Exit BTST positions before 11 am. PSU stocks are expected to attract institutional investment flows.

December 24, 2024: Tuesday: K-9: Chitra: Bullish Day - Volatile Day

A higher opening is expected. Market sentiment may appear confused, with fear and overcautious behaviour influencing volumes in the first 30 minutes. Navami favours a bullish first half and a bearish second half. Do not be surprised to see a gap-up opening and many counters hitting new highs.

December 25, 2024: Wednesday: K-10: Swati: Volatile

Swati is considered the best investment Nakshatra, and Tithi 10 is ideal for momentum stocks with a 6 to 8-month view. A negative closing would be a very positive sign for the markets. Insurance, oil refineries, and cement companies are likely to perform well, while midcap stocks could be under pressure. Contrarian investments in oversold stocks are highly recommended. Jupiter's alignment with Saturn (90 degrees) shows positive indications for the markets, potentially leading to an announcement or global event that activates significant fund participation.

December 26, 2024: Thursday: K-11: Vishakha: Auspicious Day

Historically, Tithi 11 has favoured short sellers. Despite an enthusiastic opening, markets tend to decline slowly and steadily by the end of the day. Coupled with Swati, this presents a good opportunity to average stocks showing fresh buying signals on the chart.

December 27, 2024: Friday: K-12: Anuradha: Bad Day - Good for Swing Trades

A higher opening is expected. The Tithi supports proactive action and conviction in trades. The Nakshatra favours failure patterns on both short and long sides, offering excellent opportunities on hourly charts. This day could be the most profitable of the week for traders.
Let me know if you need any further refinements.

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