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.
Review of last week
Last week, we pointed out that the TimeMap was showing a more bearish trend and that the Thursday sell-off should be seen as both an investment and a buying opportunity. Technical charts often reflect the sentiment and actions of 90 percent of the participants, who consistently lose money. Intraday chart trends consist of actions by that 90 percent, plus traders who lose money consistently. So, if you follow charts, you'll end up like them. This is the prime reason most chartists say others make money from their advice while they cannot make money themselves. Attributing this to luck is incorrect.
Technical analysis
The first principle is to never anticipate support, as it can lead to the greatest losses. Markets never bottom out precisely at support levels; they typically find a bottom in an area no one has identified. We believe the existing trend of falling prices will persist, indicating that selling pressure is intensifying as investors and traders lose patience, and new inflows are drying up. The Nifty is expected to fall another 700 points, but whether this will occur before or after a bounce remains uncertain. Per the current pattern, the target for booking profits by shorts is around the 23,300–22,850 zone, while the upside trailing stop is around 25,430. The best thing about technical analysis is that it is straightforward and executable.
TimeMap
There are still many negative factors embedded in existing investment and trading positions, and it seems unlikely there will be any relief in the coming week. Forceful or compulsive unwinding is expected in the first three days, which could provide opportunities for contrarian ideas and reversal bets. While sentiment and prices continue to hit new lows, narratives are emerging with fresh justifications.
Jupiter 180 Mercury is slightly negative for traders; the banking sector will see significant price movements or announcements from the government, which are likely to be positive.
Venus 60 Saturn is very positive for FMCG and consumer stocks.
Daily forecast:
November 18, 2024 (Monday): K.3: Mrugga: big moves
A higher opening is expected. The tithi suggests high volumes and broad-based participation. The Nifty will experience large movement, with a strong likelihood of a big positive or negative close—though a positive close is more likely. With the Moon in Mrugga, high-beta and technology stocks are expected to attract significant investments today. STBT (sell today, buy tomorrow) is indicated.
November 19, 2024 (Tuesday): K.4: Aardra: bearish day
Tithi 4 on a Tuesday often results in negative moves, even during bullish phases, making it deceptive and a trap for bulls. Currently, the sentiment is sour. The first 30 minutes of the session will be key: a negative opening may suggest a big fall, while a positive opening may end in a positive close. BTST (buy today, sell tomorrow) is advised.
November 20, 2024 (Wednesday): K.5: Punervasu: auspicious day
A flat-to-negative opening should be viewed positively. The tithi indicates a big scare in the first hour, but this should be considered as a trend reversal day, with a potential V-shaped recovery. Investors are encouraged to buy bearish stocks, provided they have sound fundamentals. Today and tomorrow are the best investment days of the week.
November 21, 2024 (Thursday): K.6: Pushya: auspicious day
Markets are expected to rise and close in the positive, and increasing accumulation is highly recommended during consolidation and oversold reversal indicators. This is one of the best days for day traders to generate substantial profits.
November 22, 2024 (Friday): K.7: Ashlesha: bullish day
Tithi 7 is bullish and the nakshatra, represented by a serpent, suggests violent movements. This day will have the best momentum breakout signals and profits. However, being on the wrong side of the trend can lead to severe losses, so traders should surrender quickly and hold positive positions, which should be 3 percent or more than the previous close in the same direction. This is also a good day to use trend-following systems.
We expect the bottoming to begin this week, with a high level of pain since movements are expected to be big and volatile. Reversal points will be difficult to trade. Delayed or second-confirmation participation is advised throughout the week, except on Monday. Contrarian bottom fishing can be considered, provided it is backed by sound fundamental research.
Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
