Stockology: Positivity seen for the Banks, IT, and selective PSU stocks

Most frontline blue-chips have given the signs of bottoming out, and Bank index is turning positive.

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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Happy New Investing Year 2025 to everyone.

Review of the Last Week: After significant movement and a sharp decline in the index, there would typically be a cascading drop in the following week, often driven by technical factors related to risk management and the structure of the system. The importance of strict regulations and risk management imposed by SEBI shows results; transparency and strict margins have protected retail investors and long-term SIP flows towards the markets. After a drop of more than 1,000 points, the markets remained in a range of just 325 points, indicating robustness built into the system. We were expecting a bit more positive movement in the markets. The Nifty level of 23,520 is intact, which provides positive comfort.

Technical: As long as Nifty trades above 23,520, there is no need to panic. A very positive sign is that most frontline blue chips have shown signs of bottoming out, and the Bank index is turning positive. The Pharma index has signalled a short-term buy, and broadly, in the next 10 days, there should be more positive movement in the indices. Index-heavy stocks, the top 10, are getting more attractive on the charts.

Closing above 24,000 will indicate that the bulls are coming back, and above 24680, the possibility of a flare-up cannot be ruled out. The bias is slightly positive until January 15, 2025. If the Nifty Index is above 25050, all short positions should be squared up. Assuming many trapped positions were already exited on the rise, positions should only be trimmed or reduced at the breaking of 23,520.

TimeMap shows positivity for the Banks, IT, and selective PSU stocks. Broadly, indices should give a positive close, but that does not mean there will be big appreciation in value or market capitalization. The Sun will transit Nakshatra PurvaShadha until January 10, and historically, this period has given a more positive move. Most technical indicators in oversold divergence match with TimeMap for a pullback.

The Nakshatra Uttarashadha is best for divergence from the exiting trend, so a short-term positive move cannot be ruled out and could extend until even January 23. As per Heliocentric positions of the planets & their aspects, the first 3 days of the week are showing a lot of positive traction in the markets, and the possibility of a more than 2 percent recovery in Nifty cannot be ruled out.

December 30, 2024: Monday: Amavasya: Moola: Volatile Bullish Day
A higher opening of indices cannot be ruled out. A gap-up will indicate and confirm that the week will close on a bullish note. Except for select capital goods sector stocks, the majority of the market will witness a positive flow of investment. A bullish bias on Amavasya is supported by data, so one can look for intraday buying opportunities. BTST (Buy today sell tomorrow) is highly recommended. Amavasya is considered auspicious in the south, and Poornima is considered in the north.

December 31, 2024: Tuesday: S.1: PurvaShadha: Good Day
A higher opening is expected. If the gap-up is nominal, it will be better for bullish traders, as they will get an opportunity to participate in the intraday swing. Being the monthly close, quarterly, and yearly closing day, past data indicates a big positive movement in select stocks. It will be more of an adjustment day for the markets. After opening volatility of 15 minutes, the markets will calm down before lunchtime, and momentum or rising prices in the last hour are expected.

January 01, 2025: Wednesday: S.2: U. Shadha: Auspicious Day
Happy New Year, and it begins with an auspicious day. Tithi -2 confirms a rising trend on a shorter time frame, giving a corrective move and testing the strength of the underlying trend. On the Nakshatra front, the divergence indicator gives the best trading opportunity. Indian investors make many decisions based on value, tradition, and emotions, and particularly at the start of the New Year, many investors begin the year by investing in direct equity, which will be seen on the screen. Huge retail participation is expected. BTST indicated.

January 02, 2025: Thursday: S.3: Shravan: Auspicious Bullish Day
The first bullish Tithi of the year, and Nakshatra Shravan, simply means market intelligence flow, or in simple language, news-followers will mint money today. A big inflow from large FIIs or funds could trigger significant buying in the markets and give a huge surprise to most market participants. STBT ( Sell today buy tomorrow) is recommended, especially for stocks closing near the high of the day.

January 03, 2025: Friday: S.4: Dhanishta: Volatile Tough Day
Greed plays a critical role. Tithi is the most deceptive of all the Tithis, and Nakshatra makes the human mind content and greedy. Volatility will be high, and many manipulative masterminds will be active in the markets. We suggest waiting for a second confirmation before participating in any trade. If your sense works well, then get aggressive and participate big, as tuning to the day is critical. When tuned in, you can mint profits of the whole month in a single day.
Large caps will be in the limelight and followed by Small Caps.

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