Stocks rise in NY

The market rebounded to 11,397 after Monday's predicted losses. The NYSE is almost back where it started the week and is poised to move higher.

As the US dollar rallied, Oil, Gold, and the Euro all lost ground. I believe there will be a turnaround here which will get us back to $125/930/1.57.

Market Forecast -- week of Jul 28 - Aug 1

New York was little changed last week after the early week rally did not hold. While the low-end forecast target of 11,600 was reached, the Dow ended the week slightly lower at 11,370 and the S&P at 1257. This week looks equally choppy, although I think the bias will be up. I am still expecting a significant rally to take place in August, but we may yet have a little more consolidation and re-testing to go. Monday may be negative as transiting Mars aspects the natal Saturn in the Dow 30 chart.

A solar eclipse occurs on Friday, so that be a signal of a trend reversal. If we get below 11,000 intraday this week, then that might be enough to propel the market higher over the next month. I think 12,700 is within reach in the next leg up. Late August or September is likely to see another top, however, which will set up the next big move down for the rest of the year which will likely knock out the previous bottom at 10,700 and possibly bring us down around 9000.

Bombay is coming off a good week and opens at 14,274. I think there may some downside bias for the Sensex this week, so perhaps it will lose some of its momentum from last week and probe below 13k. The Sun-Mercury conjunction on Wednesday occurs whilst the Moon is transiting the 12th house of the Nifty Futures chart. Moreover, Venus will come under the aspect of natal Ketu on Friday, so that is another possible negative influence.

As predicted, Tokyo is coming off a positive week and begins trading at 13,334. There's some potential for negativity this week as Sun and Mercury conjoin in he 12th house of the Topix chart. This may only manifest midweek, however, and the otherwise favourable influence of the TSE Jupiter on transiting Mercury and Sun may offset this early in the week. I don't see a big move either way.

As predicted, the Euro had a difficult week and finished at 1.5691. This week doesn't look quite as negative, but the momentum will likely continue to be flat or modestly negative. I don't think it will go much below 1.56. This will probably be a good week to short the Euro as next week promises to be another big move down, possibly to 1.52.

Oil is coming off another negative week, as forecast, and opens trading at $123. I think this will be a recovery week for crude as the Sun-Mercury conjunction occurs under the auspicious aspect of the natal Jupiter in the Futures chart. The end of the week looks strongest so we may see prices push above $125. Monday may be negative, however, and we may see $120 intraday at some point.

Gold fell sharply last week and reached our target of $920 before ending the week at $928. The bottoming process is continuing here. Like the Euro, Gold will be vulnerable to large pullbacks next week, possibly under $900, but this week the price should hold fairly firm or even trend a bit higher. But given the risks next week, I would be reluctant to take any new long positions here.

Market Forecast -- week of July 21 - 25

New York is coming off an up week that may have temporarily stilled investor anxiety. After Tuesday's intraday low of 10,730, it seems that a growing number of participants are thinking that we have formed a bottom here. Our bullish forecast was confirmed with the 4% gain, although the strength of the optimism was somewhat unexpected. The Dow opens trading at 11,496 while the S&P sits at 1260.

I think the week upcoming is likely to see further gains with the approach of transiting Mars in aspect to Jupiter. Monday may see a drop, however, as transiting Sun falls under the square aspect of the natal Saturn in the 1792 chart. Tuesday may be more positive as Mercury is in trine aspect to Uranus as the Moon transits through Jupiter-ruled Purva Bhadrapada. Wednesday looks difficult. Friday also has the potential for a significant gain as Mars comes closest to the influence of Jupiter. Depending on how severe any early week sell offs may be, I think the market can rise to 11,800/1290. If the Dow falls back below 11,200 on Monday, then we may only finish modestly higher -- 11,500 - 11,600. Looking ahead, I think last week's lows will be retested eventually, perhaps as soon as the next two weeks. This market is not out of the woods yet.

Bombay followed on New York's lead last week and came off its lows of 12.5k and closed at 13,635, slightly above the previous week's levels. While there are some favourable influences this week, I'm less sure that the Sensex will finish higher. That's because transiting Mars (20 Leo) will fall under the 8th house aspect of natal Mars (20 Capricorn) in the IFN ETF chart at the end of the week. Venus (20 Cancer) also makes an aspect to chart ruler Mars so that may have a mitigating effect. Transiting Sun comes under the aspect of natal Rahu on Monday which may make the early part of the week negative. The best chance for gains may occur Wednesday or early Thursday as transiting Venus crosses the ascendant of the Nifty Futures chart.

Tokyo resisted the up trend last week and failed to rally and closed slightly lower at 12,803. This week looks mixed as transiting Venus comes under the influence of natal Mars in the TSE chart midweek. Some recovery is possible as transiting Sun is aspected by natal Jupiter and Mercury comes to the ascendant. 13k is a reasonably intraday target here and if Wednesday is not a major pullback, then I think there's an upside bias overall.

As forecast, the Euro did move past 1.60 but did not hold that psychologically important level. It ended lower on the week and opens Monday at 1.585. As the price of crude weakens, the Euro is vulnerable to sudden declines. Monday may be one such day, as transiting Venus opposes natal Uranus. Tuesday looks bullish as Mercury and Moon are configured with natal Jupiter. Overall, I think most of the action will be to the downside. Right now, I'm looking at Aug 6th as an interim bottom.

As predicted, Oil fell last week, and even broke through the target of $130. It opens trading Monday at $128. Crude will likely recover somewhat early in the week as transiting Venus comes under natal Jupiter's aspect in the Futures chart. Prices may rise above $135 before being vulnerable to declines later in the week as transiting Sun comes under the negative influence of natal Saturn. A finish near or somewhat below current levels is the most likely outcome.

The rally in Gold failed last week and it ended slightly lower, as forecast. While it did not probe our target $940 last week, it may well this week as transiting Mercury comes under the negative influence of Saturn in the GLD ETF chart late in the week. Overall, gold looks bearish this week, and possibly into next week also. Since Sun transits Saturn-ruled Pushya, I would not rule out $920.

New York recovers, Oil falls below support levels

After a volatile week, New York ended higher Friday, closing above 11,496. This confirms our weekly forecast for an up week, although I clearly underestimated the extent of the rally. I don't think there are solid foundations here, so rallies will likely not go too far. The 30-day outlook still has considerable downside risk. I'll post more on Sunday.

As predicted, Mercury's further drift into Gemini correlated with crude breaking through $132 support this week and closed under $130. Mars was also in an unhelpful position with respect to natal Jupiter. With some hard progressed aspects forming in the coming days, the 30-day outlook looks precarious for oil. It will be prone to sharp declines below $120, and we may possibly see $110 again. While I had previously thought oil would recover in August, I think the rebound may be pushed back to September and October.

Market Forecast -- week of July 14 - 18

In the wake of last week's turbulence which saw new intraday lows below 11,000, fear and loathing remain the prevailing sentiments in world markets. The Dow begins the week at 11,100 and the S&P at 1239. While the Mars-Saturn conjunction did not bring a clear capitulation, the growing anxiety about the long term viability of mortgage lenders Fannie Mae and Freddie Mac certainly reflected the tension and injury (Mars) inflicted on economic structures (Saturn). As forecast, the market did decline last week, although not quite as much as expected. The current level above 11k is a kind of purgatory that is neither low enough to generate a sense that the selling is over, and not high enough above the new lows to create a sense of security. So we need to come to a better understanding of just where the bottom is here. My thinking was that the time around the Mars-Saturn conjunction would mark an interim bottom, wherever it occurred. And yet without the capitulation sell off that pushed the market close to the 10,500 support level, I am uneasy with the thought that there is no more downside risk.

While volatility will likely characterize much of the upcoming week, I don't foresee a large decline. Monday looks fairly bullish as Sun trines Uranus and Mercury is trined by the natal Jupiter in the S&P Futures natal Jupiter. If we see a significant up day Monday (>1%), then the week may well be positive. Wednesday and Friday both look more bearish, so I'm reluctant to say there will be any big rallies here. Mercury, the planet of commerce, is transiting Ardra which is ruled by Rahu and generally creates an unstable foundation for action. But the bias seems more to the upside here. If the Monday rally is weak, then I would still hold open the possibility that we might close below 11,000 on Friday. Beyond that, the last chance for support levels to be tested would be the first week of August which looks quite negative. The crucial point there is that the last week of July will feature a trine between Mars and Jupiter that will create upward momentum that will likely move the market well enough above where we are here that any subsequent declines will not breach previous support levels.

Bombay held up well last week to remain unchanged and opens at 13,469. While the Sensex may flirt with 13,000, especially after Monday's catch-up, I don't foresee a weekly close much below current levels. Next week looks more difficult with some tense aspects forming in the IFN chart. A new interim low is more likely to form around the 23rd.

As predicted, Tokyo fell last week and opens this week at 13,039. With transiting Saturn now separating from its aspect to the natal Venus in the TSE chart, I think there's isn't a lot of downside pressure left here. Similarly, transiting Venus comes under the aspect of Jupiter while Sun applies to the ascendant. Overall, this suggests an upside bias for the week.

As predicted, the Euro is coming off a good week, and opens Monday at 1.5947. I somewhat underestimated the extent of the rise last week, as Venus transited through the sweet spot of the 11th house of gains. Monday looks like another good day as transiting Sun comes under the aspect of natal Jupiter. This may push the Euro over 1.60. Overall, I think early in the week looks favourable, but selling pressures may emerge towards Friday. Overall, I think we will end the week close to where we are now, perhaps a little higher. Next week looks like another high, especially around Tuesday.

Despite a pullback early in the week, Oil hit new highs and closed at $145 against our expectations. I still believe Oil will be susceptible to sharp sell offs going forward although it may not be a consistent move to the downside. I don't think we'll see $150 here and look for intraday lows down to $130.

Gold is coming off a big up week and opens Monday at $960. While our forecast was correct to call for lows below $920 which were achieved in early week intraday trading, I did not expect to see a rally so soon. Gold may retrench next week back below $940 before resuming its march back to $1000 in late July and August.

New York slides

The market in New York fell off a cliff late Wednesday afternoon as the indexes declined more than 2%. The Dow closed at 11,147 and the S&P at 1244. This sets up the possibility of the much anticipated big sell off tomorrow and raises the question of possible entry points. I think if we see a real capitulation Thursday and Friday and the averages revisit 10,500, then that might be a decent bottom that would be worth buying into. There's a fair bit of support at 10,500/1180 dating back to 2006, so I can't see the Dow dropping below that level here. If we don't get a big down day tomorrow, then I would be less enthusiastic to get back in for any length of time. In that eventuality, it might take a few more trading days stretching into next week for the bottom to form. Overall though, I'm still expecting this week to be the worst.

Oil recovered a little bit today but stayed down around $136. I think we'll see more downside for the balance of the week.

Gold bounced back $5 to close at $928. After a rough Tuesday that saw an intraday as low as $912, prices are still off last week's levels. Again, I think there is more downside risk here.

The Downward Spiral

New York rallied in the morning but ended down by almost 1%. While I thought we would end ahead for the day, the rally in the morning was strong (over 1%) and offered an exit to investors seeking safe harbour. Let's see how the pessimism may build over the week.

Gold ended down, more or less as predicted. Oil also dropped back to $141 and signalled the possible end to this current rally.

Market Forecast -- week of July 7 - 11

As predicted, New York stocks fell last week as the Dow ended trading at 11,288 while the S&P stood at 1262. Sentiment is increasingly gloomy as the week's action confirmed that we are currently in a bear market -- down 20% from the 2007 highs. While the Dow managed to stay above 11,000 last week, next week promises to be even more newsworthy as the long-awaited Mars-Saturn conjunction occurs. Most observers agree that we're heading for another down week, the only question is how much. While there are whispers about the possibility of a crash here, I don't foresee things getting that bad. That said, the market is more vulnerable to sudden declines now that it has been in quite a while so I wouldn't want to rule out the possibility of the Dow going below 10,000 this week. A more likely scenario is for the markets to dip between 4-7% which would be 10,500-10,700 on the Dow and 1180-1210 on the S&P. If the rally on Monday takes off, then some of these downside targets may be tougher to meet. Nonetheless, I think we will see at least one day close decisively below 11,000/1230, and most likely Friday's close as well.

Monday has the chance for some gains as Mercury, Sun and Venus are in sidereal Gemini -- the only day they will do so -- while Moon is aspected by Jupiter. A rise of more than 1% is possible. Things may go south fairly quickly after that as the Sun opposes Jupiter on Wednesday the 9th which will set up both the Mars-Saturn conjunction and the bearish Mercury-Pluto opposition on the 10th. The possibility of a sudden market capitulation by Thursday may create some bonafide buying opportunities by Friday. After this week, we will likely be within 2-3% of an interim bottom that may be re-tested throughout July before a meaningful rally gets going in August. I would say there's a 50-50 chance that the interim lows will come this week.

In keeping with our previous forecast, Bombay is coming off another negative week in which it closed below 13,000 for the first time in many months. The Sensex opens Monday at 13,454. This week looks like more of the same with the perfection of Mars-Saturn, especially given the stresses in the IFN ETF chart. Tr Mars and Saturn will line up exactly opposite the IFN natal Venus and Mercury. I think we will see lower lows this week with a weekly close below 13,000, perhaps below 12,500. An intraday below 12k is also not out of the question.

Tokyo stands at 13,237 and has similarly been beaten down recently by dim economic prospects. The Thursday Mars-Saturn conjunction occurs right atop the ascendant of the Topix chart so it's hard to see how the Nikkei will do anything but go down. While there is a real chance of a snapback rally on Friday, we are looking at a re-testing of the March lows around 12k this week. Thus far, Tokyo has withstood the worst of the bearish mood and has remained well above its previous lows. This week looks like it plays a bit of catch up.

As expected, the Euro did have a tougher go of it this week, as the ECB signalled it had finished this round of rate cutting. While I had thought it would finish close to 1.58, Friday's sell off pushed it down and it opens at 1.5706. I think the Euro is poised to continue its longer term rally this week, although Monday looks quite negative. Transiting Mercury will pass over the MC and thereby form an opposition with Pluto on the Euro's IC. While not an obviously bullish pattern, it nonetheless looks significant and indicates that currency moves will be big this week. Overall, I expect the Euro will at least get back above 1.58. At the same time, however, some downside protection might be a good idea in case Pluto gets the upper hand.

As predicted, Gold was volatile last week and barely managed a gain overall, closing at $934. The early part of the week looks worst, as transiting Sun conjoins Saturn in the Futures chart. Friday may see a nice rally as Mercury is in aspect with Uranus in the Futures chart but generally, I'm not bullish on Gold here. I think we'll close lower for the week, possibly under $920 at some point intraweek Gold still has at least two more weeks to go before it makes a decisive break out move above $950 and launches another big run past $1000. I expect there will still be buying opportunities below $920 in the meantime. $900 entry points may no longer be possible.

While Oil failed to reach $150 last week, it did rally further to $145, as forecast. As Mercury moves out of the range of Rahu, however, there is less reason to stay with Oil. Mercury's entry into Gemini more or less spells the end of this current run-up so this week will likely see a significant decline in crude. Transiting Mars-Saturn will oppose the natal Venus in the Oil ETF chart which might push it down sharply, perhaps back to $130. The next week or two look mixed before another rally ensues after July 18th.