Stocks in New York made new highs for 2009 last week as improving housing data supplied the hope necessary to extend the summer rally. After Monday's sharp decline, stocks rebounded and ended 2% to the good with the Dow closing at 9505 and the S&P at 1026. While I have a pessimistic view of stocks right now, this outcome was not that far out of line with last week's forecast -- at least in terms of ebb and flow. Monday's pullback came right on schedule with the Mercury-Saturn conjunction, even if it was fairly mild, at least in the US. I had also suggested that some gains were likely Wednesday through Friday as Mercury and Venus were involved with better planetary company. This bullish script also played out more or less as rehearsed as stocks went straight up after Monday. There was a somewhat different story in Mumbai as stocks fell over 1% for the week, although the basic trends were the same. Monday's decline was steeper (5%) and hence that perhaps better captured the extent of bearishness I was expecting. The rebound was also somewhat more muted especially since Wednesday ended down. Thursday and Friday were positive though so that was solid evidence for the benefic effects of Mercury and Venus.
The planetary focus this week is a fairly rare and powerful four planet alignment involving Mercury, Mars, Pluto, and Rahu. All these planets will be a 6 degrees of their respective signs and will therefore be in mutual harmonic resonance. In addition, Mercury falls under the full strength aspect of malefic Mars and disruptive Rahu. On paper, it's a rogue's gallery of planetary evil-doers all ganging up on Mercury, the quintessential innocent bystander and has all the makings of a bear party for all markets, including oil and especially gold. Since Mercury is slowing down in advance of its retrograde cycle, this alignment could conceivably kick-in at any time in the week, although the early to midweek may be more likely. One interesting twist here is that Venus will conjoin Ketu on Wednesday and this bullish influence could be enough to interrupt the bear party, if only for a few hours. Later in the week, Pluto and Rahu get left behind and Venus moves into the picture, so there may be more opportunity for the bulls to run again then.
Despite these new highs, it's hard to come up with too many more bullish planetary patterns in the coming weeks. Sure, there are a smattering of a fairly good aspect late this week and a potentially significant two-day multi-aspect next week, but these little pools of hope are fast petering out and there will soon be no more oases for the bulls to feed on. And with fewer good aspects and an increasing number of bad aspects, the market will soon begin to fall.
