Stock rally extended

Wall St rose sharply today on expectation of the bank bailout and the passing of the stimulus plan. Stocks gained 3% as the Dow closed at 8375 and the S&P at 874. Indian markets also extended Tuesday's gains as the Nifty closed at 2849 and the Sensex at 9257.

So far the rally is ahead of schedule, as I had expected declines earlier in the week and for gains at the end of the week. The market has risen on the heels of the Mercury-Mars conjunction, perhaps as the negativity of Mars moves out of the picture. While Mercury approaches its direct station on the weekend, we can still wonder how long this rally will last. There will be a lot of resistance around 8500 on the Dow and 880 on the SPX. The Nifty may similarly have a tough time going over 2950 and staying there.

Forecast for week of Jan 26 -30

US stocks took another beating last week as fears about the viability of the banking sector continued to rattle investors. The feel-good Obama inauguration failed to boost sentiment as the Dow lost over 2% on the week and ended Friday at 8077 with the S&P at 831. I had thought the Sun-Mercury-Jupiter conjunction might have provided the necessary lift for some kind of a brief rally but in the end Mercury's motion away from the positive influence of Jupiter limited the available optimism. Tuesday's loss coincided with Mercury's conjunction with the Sun, which gives support to the notion that planetary combustion is clearly a malefic influence.

This week looks action-packed, as we have the solar eclipse on Monday and the Mercury-Mars conjunction on Tuesday, along with Venus' ingress into Pisces. While the eclipse configuration has the imprint of both Jupiter and Saturn, I think the overall effect will be negative and underlines the probability that we are headed lower over the coming weeks. The early part of the week may see sharp declines with the possibility of some recovery by Friday.

Indian markets were also strongly negative last week with the Nifty falling to 2678 and the Sensex at 8674. Tuesday and Wednesday saw the markets fall over 6% at the time of the Sun-Mercury conjunction. That conjunction occurred at 6 Capricorn formed a harmonic aspect with the malefic Mars-Rahu square in the NSE chart and should be seen as a possible signature for the depth of the decline in Mumbai.

With Monday's holiday closing, most of the action this week will occur Tuesday. The Mercury-Mars conjunction occurs at 11.40 a.m. IST. While not necessarily negative in itself, the latent Saturn influence on the conjunction has the potential to push markets over the edge. We could see more significant declines there with only a small chance of recovery later on. Friday may be the best day as the Moon and Venus conjoin in early Pisces near the 10th house cusp of the NSE chart and near the 4th house cusp in the Nifty chart. I think most of the movement in the coming weeks will be on the downside.

Crude oil and Gold both rose sharply last week, mostly due to the Sun-Jupiter conjunction. The Sun received Jupiter's optimism and therefore Gold rose to $895 on Friday. Oil rose because its dispositor is also the Sun, since Saturn is currently in the sign of Leo. I think the rally in crude may continue this week although the rise may be more muted. Gold seems to be at the end of its recent rally and with the Jupiter's influence behind it, the Sun now has to contend with the conjunction with Rahu on Wednesday. By Friday, I think gold should be down significantly from its highs.

Stocks move lower -- again

Wall St continued to be plagued by bearishness amidst more bad earnings and no new initiatives from the incoming Obama administration. The Dow fell one percent to 8122 and the S&P ended the day at 827. In Mumbai, stocks were largely flat, providing little relief for the negative week. The Nifty was slightly higher at 2713, while the Sensex closed at 8813.

I had thought we'd see more of a rally this week, but the markets seem to have other plans. Tomorrow sees the Sun-Jupiter conjunction come exact, but there's no guarantee that an up day is in store. Even if there is some buying tomorrow, there isn't much upward momentum here. As ever, caution is the watchword for the coming weeks as we will likely move lower.

Markets continue slide as recession deepens

Stocks fell another 4% in New York last week a growing number of investors realized that the recession will likely last through all of 2009. After touching 8000 on Thursday, the Dow rebounded Friday and ended the week at 8281, while the S&P ended at 850. Both indexes are below their 50 day moving average now as the the market ponders the fork in the road: to reach the technical safety of higher ground or to sink back down to the November lows. Certainly, the pessimism from the Mercury-Saturn aspect last week had the desired effect as sentiment fell very close to when the aspect came exact. And it is also possible to see how the late week turn higher reflects the tug of war between Rahu and Jupiter over the affections of Mercury. As long as retrograde Mercury was closer to the disruptive influence of Rahu, the market sold off. Once Mercury was closer to benefic Jupiter, the market shook off the blues and pushed higher.

With US markets closed Monday and the Obama inauguration on Tuesday, there will be compressed time frame for trading this week. Overall, I think the chances for a big rally are very good as Sun, Mercury and Jupter conjoin in Uttarashada. This nakshatra is ruled by the Sun, so having that doubly helpful influence on the nakshatra lord should give an extra boost to sentiment. The Sun-Jupiter conjunction comes exact on Friday and may well mark the approximate end of this mini-rally. In addition, Venus is conjoining Uranus this week, and comes exact on Thursday so that may provide some additional heft to the bullishness. How high could it go? Well, I think it's possible the market may soar as high as Obama's rhetoric. The US has been waiting for a new beginning for a long time, and the incoming Obama administration is a once-in-a-generation opportunity to turn the page and start anew. Optimism will rule the day and will likely spill over into the market. I would not be surprised to see the Dow get to 9500 here. Next week's Saturnized solar eclipse may be the proverbial bucket of cold water on the parade, so investors should enjoy the ride while it lasts.

Indian markets were modestly lower after a volatile week in the wake of the Satyam revelations. After bouncing off lows of 9000, the Sensex ended Friday's session at 9323, with the Nifty at 2828. The negative action came off more or less according to expectations, as the Mercury-Saturn aspect pushed stocks much lower on Thursday. I had thought that Wednesday might have been more negative, but perhaps the happy glow from the Moon-Venus aspect was enough to temporarily mask the hardened resignation of Mercury's sad condition. Friday's gain also was a little surprising in light of the twin Mars aspects to the NSE chart. The transiting Moon's aspect to a fast-strengthening Mercury proved more than enough to counteract the negativity contained in the natal charts.

While the early week may be tentative, I think Mumbai will also move higher this week as the Sun-Jupiter brings its message of optimism and hope back to the market. The Venus-Uranus conjunction will form a nice aspect to the natal Jupiter in the NSE chart so that is additional support the rally hypothesis here. The Sun-Jupiter conjunction does not form any obvious aspects to this natal chart but that may not matter. Thursday may be a possible down day as the Moon squares Saturn in the afternoon. However, even that bearish indicator may be pushed to the side with the presence of Venus in aspect to Saturn. There is a potential for a big lift here, perhaps to Nifty 3000 and 10,000 on the Sensex.

The rally in stocks this week will probably push crude oil temporarily higher. The US dollar is likely to take a pounding this week, so that may provide some support for gold. Paradoxically, gold seems prone to a steep decline here as the Sun-Jupiter conjunction falls in a delicate area of the GLD chart. This is likely to take hold towards the end of the week or perhaps early next week.

Dow tests 8000

Stocks in New York broke their losing streak today after the Dow briefly touched 8000 at midday, ending the day at 8212. The SPX ended the day unchanged at 843 after probing 820. In Mumbai, stocks lost 3% as the Nifty closed at 2736 and the Sensex at 9046.

This week is unfolding bearishly as was indicated by the Mercury-Saturn aspect. Admittedly, I did not expect Dow 8000 to be in the mix but today's afternoon reversal is an indication of the Obama rally that lies ahead for next week. Indian markets may well finish in the red tomorrow, however as transiting Mars may cause havoc with the NSE natal chart.

Stocks fall for fourth straight day

Stocks fell further today on fears that corporate earnings would fall far short of expectations. The Dow finished at 8473 and the SPX at 870 as stocks slipped further below their 50 day moving average. In Mumbai, the arrest of Satyam CEO Raju did little to calm investors as stocks fell 3%. The Nifty ended trading at 2773 and the Sensex at 9110.

Even if the market bounces back tomorrow -- and that is a very big if -- I think there's a good chance that the Dow will fall below 8400 this week. It may stay above 8200 before turning around, but I think the market has to move lower before it can make a sustainable rally. The Mercury-Saturn aspect is close enough to get the blame for today's bearishness but I think there's more pessimism left in that aspect that remains to be made manifest. Similarly, the Indian markets are looking to pull back further this week, perhaps by a greater proportion than US markets.

Stocks succumb to bad economic news

Markets headed south last week with the approach of Mercury to Rahu and the impending Mercury retrograde cycle as the Dow ended Friday at 8599 and the SPX at 890. The bearish sentiment was punctuated by a difficult Mercury-Saturn aspect that was in hindsight the more immediate cause of Wednesday's substantial decline. The general picture of a shift to pessimism was largely in keeping with our expectations laid out last week.

With Mercury turning retrograde this weekend, we are entering a zone of transitional energies where Mercury, the planet of trading, is slowing separating from the disruptive influence of Rahu and moving towards the warmer embrace of Jupiter's optimism. This shift will take time, and we may see prices fall further this week before they move up again and stage some kind of rally. Look for some kind of bounce up Monday or Tuesday, after which the market will sell off as Mercury again aspects Saturn and move back down towards 8400/870. The late week could go either way, but by Friday we may finally see Jupiter's favourable influence become manifest. The subsequent rally next week may be short-lived but it could be substantial and return the market to its November highs. A sharp turn downwards is likely in the last week for a variety of astrological reasons, not the least of which is a solar eclipse on January 26. This eclipse features several strong aspects, including a close Jupiter conjunction to the Sun and Moon. Jupiter's influence is offset by two important factors: 1) a close Saturn aspect to the eclipse point and 2) a powerful alignment of Venus, Saturn and Uranus straddling the MC-IC. While different interpretations of this configuration are possible, I think the negative outweighs the positive and the Jupiter influence may only manifest as a magnification of the bearish mood.

Mumbai also had a down week as markets sold off sharply in the wake of the Satyam debacle on Wednesday. The Sensex closed Friday at 9406 and the Nifty at 2873, as the indices once again failed to break through their key resistance levels (Nifty 3150). The Mercury-Saturn aspect was mostly responsible for a sharp sell off, which activated the natal Saturn in the NSE chart. Overall, markets moved according to expectation, although the downside was somewhat greater than anticipated. Look for the market to move lower this week, after a gain early on, perhaps on Tuesday. Indian markets may not see the rally begin until next week but it should be fairly strong and push the Nifty above 3000. It's possible we could see 3100 again by the 23rd but this seems like a bit of a stretch. The eclipse of January 26 will likely decisively break the bullish mood. The eclipse point falls at 12 Capricorn and this will once again activate the NSE Saturn at 12 Aquarius. Given transiting Saturn's placement in aspect to this degree, it seems likely that Indian markets will head down substantially in the weeks following the eclipse. A retest of the October lows of Nifty 2525 seems the most likely scenario.

The US dollar gained some ground last week against most currencies as crude oil sold off hard to $41 and gold slipped back to $855. This week looks more equivocal for the dollar and commodities without a strong trend although I would think the dollar remains weakly bullish which means that commodities will trend somewhat lower.

Stocks slip back

No big sell off today but there was at least a mood of caution as some investors took some money off the table after the string of gains last week. The Dow fell back to 8952 and the S&P to 927. Mumbai fared better as stocks added another 3% with an impressive end of the day rally. The Sensex closed at 10,275 and the Nifty at 3121.

I think we will see more caution come into the market this week as the influence of Jupiter wanes and the disruptive influence of Mercury-Rahu builds towards Friday. I wouldn't rule out some gains tomorrow in the US, but they are unlikely to be anything major. Gold fell $20 today so that is also a welcome development as the US dollar made up some lost ground as the Euro lost 3 cents. Hopefully we will see these trends continue further and watch gold really being to fall back towards longer term support levels in the coming weeks.

Forecast for week of January 5 - 9

US markets staged an impressive rally last week as the Dow powered above the 9000 mark by Friday and finished at 9034 and the S&P at 931. While I had wondered if the Mercury-Jupiter conjunction might provide enough of a midweek lift for 8800, Friday's rally was surprising. In retrospect, there some good rationale for the rise given the proximity of the aspect from transiting Jupiter to the natal Sun in the NYSE chart. This aspect comes exact Monday so it's possible there may be a little more optimism left to be expressed although I think it is not at all clear with the difficult Mars-Saturn aspect on Monday. As the Jupiter aspect runs out of juice, we will see more profit taking, with Thursday and Friday perhaps being more clearly negative. Overall, I think the mood will shift to bearish this week, particularly with the approach of the Mercury retrograde station on Saturday the 10th. This station will bring volatility and uncertainty in the markets due to the close conjunction with unpredictable Rahu (North Lunar Node).

I had thought we'd have a clearer low here below Dow 8400 but now I'm not so sure. January's rally may be a very choppy affair with relatively little upside. 10,000 is only a possibility here, with 9600 a more likely target. The period immediately following the inauguration on the 20th may be the high as Sun conjoins Jupiter. Look for markets to sink lower in the last week of January as the Mercury retrograde cycle comes to a very bearish end as Mercury will conjoin malefic Mars at that time. February and March now look like the time when the market will finally go below Dow 8000 before starting a stronger rally for the summer.

Indian markets also rose strongly last week as Indo-Pak tensions eased and the RBI cut interest rates. The Nifty gained 6% to 3046 and the Sensex closed Friday at 9958. Again, the upside from the Mercury-Jupiter conjunction wasn't entirely unexpected but I wished I had surrendered a bit more to the logic of it in last week's forecast. This week may move the Nifty back below 3000, as Monday may be negative with the Sun-Ketu aspect in the NSE chart. Some gains are possible by midweek but with the holiday closing Thursday, Friday may see some major selling pressure which pushes markets lower. It seems that my previous forecast of 2700 on the Nifty may not become a reality this month and may only come to pass in February and March when markets will begin a longer trend down. The upside in January is likely to be quite limited, and it's possible that Nifty 3150 may remain a significant resistance level. Nifty 3500 seems a little too ambitious. Overall, January looks very changeable with short rallies followed by quick sell offs.