Sunday, February 1, 2009

Stocks slump back after rally

Stocks in New York followed a sisyphean trajectory last week as an early rally culminated in Wednesday's high only to fall back by Friday below last week's close. The Dow closed at 8000 and the SPX ended at 825. I had thought the early week could be more negative with the Mercury Rx-Mars conjunction but it seems only to have increased the energy available to market participants rather than move the market in any particular direction. Its placement in Sun-ruled Uttarashada may be shaped the outcome as the Sun is under the presumed influence of Rahu and Jupiter in Capricorn. While Rahu is disruptive by itself, its current conjunction with Jupiter can produce acquisitiveness and buying. Overall, the market was slightly negative.

This week should see continued volatility as Saturn exactly opposes Uranus on Thursday with a t-square from the Moon forming during trading hours EST . There is a potential for a short rally before then, perhaps Monday or Tuesday when Moon is in Aries while its dispositor Mars is exalted in Capricorn. Tuesday's Moon has the added positive feature of being in Venus-ruled Bharani which is also currently exalted in Pisces. By Friday, Venus will square Pluto and combined with Saturn-Uranus opens the door to a possible return down to current support levels of Dow 7900 and SPX 805. February and March are shaping up quite negatively so the only question is whether the November lows of 7400/750 will hold. I think they won't.

Mumbai bounced back last week as markets rallied 7% with the Sensex closing Friday at 9424 and the Nifty at 2874. The extent of the upside surprised me, mostly because I did not expect the early week gains on the Mercury Mars conjunction. As strong as the rally was, I don't think it changes the fundamental direction of the market down. This week should see averages somewhat lower by Friday although if the early week gains come to pass, then the overall decline could be minimal or even be flat. Monday and Tuesday will see the now forward moving Mercury in a helpful aspect with the natal Jupiter in the NSE chart. This may give some support to prices. In addition to the difficult transit patterns that will build up by late week, Mercury will be sitting on the 12th house cusp of the Sensex natal chart. On Friday, the Moon will transit Ardra, a particularly difficult nakshatra. These are bearish influences that could bring down prices sharply.

Gold extended its recent gains last week as it closed at $928. While some retracement down did occur early on, prices resumed their upward climb following the Sun-Rahu conjunction. This week may see a couple of down days as Mars aspects Ketu in the GLD chart, but gold seems likely to continue to rise at least for the duration of the Sun's transit of Capricorn until Feb 12 and perhaps several days beyond. Gold may only begin to fall significantly in March once the Venus retrograde cycle has started. (Mar 6). So even if it tops out around $1000 in the next two weeks, the Venus retrograde period will return it back below $800.