US stocks plunge 6%; Dow trades below 8000

US markets remained in retest mode today as the Dow broke the 8000 level and closed at 7997 while the SPX probed lower and closed at 806. Asian bourses started the day in the red as the Nifty sank to 2635 and the Sensex to 8773.

It was an ugly day on Wall St, and the extent of the downside was surprising. While I had expected a Dow retest, I had hoped we would have been done with it yesterday. Tomorrow is therefore the probable reversal day. Depending on how low we go at the open, the strength in the afternoon should push prices in New York significantly higher.

US stocks move higher on rally at the clse

With a strong rally at the close, US stocks moved 1% higher after venturing into retest territory in the early afternoon. The Dow finished at 8424 and the SPX at 859. Asian markets were lower as stocks in Mumbai lost 4%. The Sensex ended trading near the lows of the day at 8937 and the Nifty at 2683.

While the Dow did not quite match its October low, the SPX did and in fact almost
matched Thursday's low of 820. The rally near the close is an indication of things to come this week. There's a chance for Dow 9000 by Friday and Nifty 3000. Let's see if enough market participants believe that he have had a retest to push prices higher.

US stocks fall on Citigroup cuts

Stocks in New York fell over 2% after massive job cuts at Citigroup and news that Japan had slipped into recession. The Dow closed near its lows for the day at 8273 while the SPX ended at 850. Indian markets staged an impressive afternoon rally and only closed marginally down. The Nifty ended trading at 2799 and the Sensex finished at 9291.

So no retest in New York today but the real possibility for a lower open tomorrow. I'm doubtful we will see Dow 8000 here but it's still possible. Nifty 2700 is very likely tomorrow. After that, perhaps a lift.

Market Forecast -- week of Nov 17 - 21

Stocks slumped 5% worldwide last week on continuing fears that the recession may be deeper than first thought. Despite an impressive rally Thursday in New York following an apparent retest of Dow 8000, the market slipped back Friday as the Dow closed at 8497 and the SPX at 873. I had expected more of rally last week on the basis of the favourable Jupiter-Uranus aspect but it seems that the hangover effects of the preceding week's Saturn-Uranus opposition still carried the day.

I think markets are likely to be shaky in the early part of the week on the heels of Saturn's aspect to Mercury on Monday. I would not be surprised to see yet another retest of Dow 8000 then. Stocks are likely to improve significantly as the week progresses as Mercury joins the Sun and Mars in Scorpio. Venus' ingress into Purvashada will also be supportive of sentiment as Jupiter's aspect to Saturn perfects on Friday. Depending on how low we go early on, we could end the week at or above current levels.

In Mumbai, markets also succumbed to pessimism as the major indices failed to hold onto early gains that put them over key psychological levels of 10,000 on the Sensex and 3000 on the Nifty. The Sensex closed Friday at 9385 and the Nifty at 2810. Monday should be quite negative but look for a reversal Tuesday or Wednesday as transiting Mercury conjoins the natal Jupiter in the NSE chart. Friday looks quite favourable as the Moon transits Purva Phalguni while its lord Venus lords over Purvashada. Barring some catastrophic meltdown in the early part of the week, Indian markets should finish higher than current levels.

The Euro slipped back to 1.26 last week the bearishness in stocks pushed investors to once again seek safe haven in the US dollar. I think there could be more weakness at the start of the week, perhaps under 1.25, but look for the Euro to recover by week's end as Venus conjoins the natal Sun in the Euro chart. We should see a similar pattern in the Rupee which also lost ground last week and closed at 48.8. Early trading may push it above 50 but looks for strengthening by Friday at least back to current levels and then some.

Crude oil fell sharply last week and opens Monday at $57. With Sun and Mercury transiting the 6th house of the Futures chart, more declines are likely early in the week, and we will likely see $55 easily broken. Some bounce is likely by Friday so we return to current levels or slightly above. Crude prices will likely continue to weaken through December, however, as transiting Ketu aspects natal Jupiter

Gold made some modest gains to $742 last week, just as the Sun was leaving Libra, its sign of debilitation. I think gold is likely to move higher this week as the Sun is joined by Mercury in Scorpio after midweek.


For a more detailed forecast, become a subscriber to the MVA Investor Newsletter

Wild ride on Wall St

US stocks swung wildly in a 10% range today before finally closing up 6%. After a midday testing of 8000, the Dow closed at 8835 and the S&P ended at 911. Indian markets were shut for a holiday.

The huge swings this week speak to the ongoing struggle between Uranus and Saturn who are both competing for Jupiter's attention. All three are in close aspect with each other hence the rapid movement between Saturn's pessimism and Uranus' exuberance. The earlier down move this week was so strong, I assumed Saturn was edging out Uranus. After today's action, I'm not so sure. We could start lower in the morning tomorrow, but move up in the afternoon after the Moon moves away from Rahu's influence.

In any event, I still think there is some significant negative energy that needs to be released over the next few sessions. Let's see how it plays out.

US stocks continue downwards

Stocks in New York fell further today on the usual array of gloomy economic news. The Dow ended the day at 8282 while the S&P closed at 852. Indian markets also declined 3% as the Sensex closed at 9536 and the Nifty ended the session at 2848. Mumbai is closed for trading tomorrow so it will have to play catch up on the downside Friday.

My bullish prediction for the week notwithstanding, it's clear that momentum has shifted and we're likely headed down until early next week when we may form a temporary bottom. Even if we manage an up day tomorrow or Friday, we will still likely break below 8000 on the Dow and perhaps 8800 on the Sensex. While I have been stunningly wrong about the market this week, the silver lining is that the trend is down and that is still very much going according to plan.

Markets slide on economic worries

Markets worldwide succumbed to plethora of bad economic news today. In New York stocks fell 2% as the Dow closed at 8693 while the S&P ended the session at 898. Asian losses were steeper, as Indian markets slumped over 6% as the Sensex closed at 9839 and the Nifty at 2938.

Tomorrow should finally see some significant gains in the US in advance of the Full Moon, although the outlook may be less positive for Asia. November is shaping up to be a mixed month within a fairly narrow trading range.