Market slides after Dubai suspends repayments

Stocks ended down last week as worries over the Dubai debt crisis brought back uncomfortable memories of the meltdown of 2008. After moving higher in the early going New York was mostly unchanged as the Dow closed Friday at 10,309 and the S&P at 1087. Mumbai was lower by 2% as the Sensex ended the week at 16,632 and the Nifty at 4941. I had been more bullish on the Venus influence here and, indeed, the market was generally higher through Wednesday, especially in the US. I was correct in expecting gains Monday in the US on the Moon-Venus-Jupiter aspect, and the market even backed off on cue in the afternoon as the aspect separated. Tuesday did see some of the predicted selling in the morning come to pass on the bearish Sun-Saturn aspect, although I thought the decline might have lasted more into the close. Instead buyers moved back in and bid up prices in the afternoon. Wednesday also went more or less according to plan as stocks rose modestly on the Venus-Uranus-Neptune influence. However, I missed the extent and precise timing of the late week Dubai decline. While I correctly expected Friday to be down on Venus' ingress into Scorpio and the Moon-Saturn-Pluto pattern, the Dubai news broke Thursday. One possible explanation here is that Thursday's Mercury-Mars "trine" (120 degree) aspect also played a key role in changing sentiment. Although the trine is often thought of as a positive aspect, Mars may have been particularly damaging in this instance since it was 1) debilitated in sidereal Cancer and 2) moving more slowly than usual ahead of its retrograde station in mid-December. Given the plausible role of a Mars aspect in this unfolding of the Dubai crisis, this may be a clue that the upcoming Mars retrograde cycle may not be kind to markets.

The main question on investors' minds this week concerns whether the Dubai problem can be contained or whether it will spread like a contagion and expose other areas of financial instability in the global economic system. The planets this week point to the latter scenario as the tense aspects appear to have the upper hand in the near future. Monday could be fairly mixed as we see both negative and positive aspects at work simultaneously. Moon transits Aries in square aspect with Mars but Mercury forms a nice angle with Uranus. The negative may carry the day here, especially in the US, but stocks should move higher going into midweek as the Moon is exalted in Taurus opposite Venus. But even if we see a day or two of gains, I think the overall bias seems negative, with the possibility of a big down day at some point. Mars' minor aspect with Saturn is exact on Friday so that identifies the late week as a potential danger zone.

The potential Dubai default has emerged here as a reasonable catalyst for a significant market correction. Certainly, the planets over the next few weeks would support some kind of pullback. The upcoming Mars retrograde cycle occurs during a tight Saturn-Pluto aspect and even aspects it quite closely if minor aspects and divisional charts are used. This are a very bearish confluence of measurements. At the same time, we still have to try to make sense of the conjunction between Jupiter (growth, wealth) and Neptune (hope, illusion) conjunction that is exact on December 21. This planetary combination of "growth" and "hope" is often correlated with gains and rallies as indeed we saw the rally in spring 2009 largely coinciding with this conjunction. One possible interpretation is that the Jupiter-Neptune rally will occur but it will be squeezed into a relatively short time span in mid-December. It may still be fairly strong in terms of amplitude but its overall effects may be mitigated by losses that occur before and after. Just how this source of positive energy manifests will be an important question in the days ahead. It's conceivable that it won't be enough to move markets very much at all. Instead it may only reflect the role of inflationary (Jupiter+Neptune) spending from huge deficits in the current economic circumstance. We will have to watch this aspect closely as it moves into position in the coming days.

Venus loves stocks

After another strong Monday that pushed the market to new highs, enthusiasm for stocks in New York faded last week as the indexes ended mostly flat. President Obama's midweek comment on the possibility of a double dip recession appeared to tipped the scales in favour of the bears as the Dow closed at 10,318 while the S&P finished at 1091. Indian stocks fared a little better as Friday's late day rally came on reassurances that the government would not tax foreign investment capital. The Nifty gained 1% on the week to close at 5052 while the Sensex stood at 17,021. Tuesday's Mercury-Saturn-Pluto alignment turned out to be a non-event as stocks showed only mild intraday weakness. This outcome gave some support to the idea that not all aspects are created equal. Last week I had wondered if the third house, sextile aspect was less malefic than the conjunction or square. In the current circumstance, this relatively benign result supported that view, my own bearish forecast notwithstanding. Empirical reality can be a cruel teacher. The second main aspect for the week was the Venus-Mars square which arguably created more problems. With Mars in debilitation in sidereal Cancer, even a strong Venus in Libra was put under significant stress by this aspect which coincided with modest selling in global markets Wednesday and Thursday. Even there, one could argue that the Thursday's decline was not the result of the Venus-Mars square but rather the Moon-Pluto-Saturn alignment. As I noted last week, this was the same pattern that sent stocks lower on the previous Thursday also. With declines coming on consecutive Moon-Saturn-Pluto patterns, we have a better sense of what kind of reservoir of bearish sentiment may be contained within the Saturn-Pluto combination. I believe we have only begun to tap into the possibilities in this malefic aspect.

With holiday-shortened week due to US Thanksgiving, markets are usually fairly quiet and show a bullish bias. This is likely to be the case also this year as benefic Venus will make its presence felt through several aspects. Monday features a Moon-Venus-Jupiter pattern that ought to encourage optimism, at least at the outset. Once the aspect is exact around midday, there could be some erosion of confidence. At the same time, the Sun will come under Saturn's aspect Monday and especially Tuesday, so that is a potentially bearish influence. There ought to be enough negative planetary energy there to generate several hours of selling which ought to be good for one down day. Wednesday appears to be a return to the happy influence of Venus as it forms close aspects to both Uranus and Neptune. This could well carry over into Thursday in many global markets. Friday could signal a change in the mood as Venus enters sidereal Scorpio and will therefore weaken somewhat. The Moon will oppose Saturn and may bring out the bleakness of Saturn-Pluto once again. Friday may be worse in Asian markets since the Moon-Saturn angle will be that much closer.

In the wake of Obama's trip to China, there is increasing concern to do something about the falling US dollar. China has invested heavily in US treasuries and they can't be too pleased with their tumbling value. Chinese banking officials are now openly complaining about the loose US monetary policy that lies behind the dollar's ongoing weakness. The Fed's near-zero interest rate policy has produced a new speculative bubble in equities and commodities may lead to another crash in the near future. While a crash may be overstating things, markets are certainly vulnerable to substantial correction in this upcoming period of the Saturn-Pluto square and the beginning of the Mars and Saturn retrograde cycles over the next two months.

Stocks push higher; Mercury-Saturn ahead

Stocks bubbled higher last week as the US Dollar continued to teeter on the edge of oblivion at its key support level of USDX75. The Dow pushed to new highs midweek before closing at 10,270 while the S&P matched its October highs and finished at 1093 (beware the double top). In Mumbai, the indices shook off the recent correction as the Sensex climbed 4% to close at 16,848 and the Nifty finished at 4998. So the midweek Mercury-Uranus-Ketu pattern was mostly bullish, no doubt aided by the simultaneous Sun-Jupiter aspect. It's noteworthy that the high point for the week coincided with those two aspects after which there was a slight retreat. Thursday was an important statement of the bearish potential of the Saturn-Pluto aspect as the Moon acted as trigger during its tight conjunction with Saturn in sidereal Virgo. The release of this Saturn-Pluto energy pushed global markets down across the board. As precise as the timing of this aspect was, it's worth noting that the Moon is the fastest moving planet in the astrological pantheon and therefore is a fairly weak trigger. Usually, planetary power is inversely related with velocity: the slower the planet, the greater the capacity to manifest in human sentiment and action. If the market dropped 1% with the fast-moving Moon, I wonder how much it could drop with a slower moving body like the Sun, Mercury or Mars, to say nothing of Uranus, Rahu or Ketu?

This week may provide some useful data that may answer that question as Mercury falls under the full strength sextile (60 degree) aspect of pessimistic Saturn. This planetary combination is bearish enough, but the fact that Saturn is in a close square aspect with cold, cruel Pluto increases the potential for a significant move. The three-planet alignment makes its closest angle on Tuesday. One possible saving grace is that the sextile is probably not as strong as the conjunction or square so its damage may be mitigated somewhat. Nonetheless, this is still a dangerous combination.

On Wednesday and Thursday, Mars forms an exact square aspect with Venus. Since Mars is debilitated here in sidereal Cancer, it has considerable potential to do harm. Readers may recall the damage Mars did through its square aspect with the Sun back in late October. The market dropped about 5% in a three-day pullback. While there is some bearish potential here, it's important to note the differences. The Sun was also debilitated in Libra at the time, so that may have increased the bearish potential of the aspect. By contrast, Venus here is in its own sign (Libra) and hence much stronger. As a result it may be able to better withstand Mars' unwelcome overtures. We should also note that this Thursday will see an echo of last Thursday's bearish pattern as the Moon may once again activate the Saturn-Pluto square. The Moon will conjoin Pluto at 8 Sagittarius (Lahiri) during the afternoon in New York. History needn't repeat exactly since the Moon will be conjoining Pluto instead of Saturn, but it will nonetheless bear watching.
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Stocks lift on Sun-Mercury conjunction; uncertainty ahead on Me-Ur-Ke

Stocks bounced back last week on some less-than-awful US employment data and more cheap money happy talk from Fed Chair Ben Bernanke. In New York, the Dow climbed 3% to 10,023 while the S&P finished at 1069. In Mumbai, equities rallied back after Tuesday's thumping as the Nifty ended Friday at 4796 and the Sensex at 16,158. The midweek conjunction of Sun and Mercury delivered higher prices as expected, although the early and late week downside did not quite deliver the goods. While New York was quite solid in the early going, Mumbai was down Tuesday on the Aries Moon and Mercury-Mars square, probably because of Mars afflictions to key placements in the NSE natal chart. Despite a minor Mercury-Saturn aspect, Friday saw the bulls once again carry the day. All in all, it was a victory for the bullish short term aspects over more challenging and shadowy medium term influences. In other words, another edifying lesson in empiricism.

This week could make or break the correction as the Mercury-Uranus-Ketu grand trine configuration takes root around midweek. Both Uranus and Ketu are planets that symbolize change and sudden events and their close aspect here would seem to incline towards new and unforeseen developments. As a fast moving planet, Mercury may be able to act as a trigger to release whatever surprises Uranus and Ketu have in store. By itself, the Mercury-Uranus combination is often bullish, and all the more so given Neptune's additional harmonic influence there. But Ketu changes things up considerably, and it's unclear if stocks can handle so much uncertainty and suddenness. The background influence of the Saturn-Pluto square should also be seen as a negative factor, although it's precise due date is still up in the air. Venus forms an alignment with Saturn and Pluto before trading on Monday, so that could generate some fear and disappointment. However, this aspect clears out fairly quickly so it's conceivable that Monday may not be too bad. Tuesday features the Sun-Jupiter square, a classic symbol of unfounded optimism and excessive expectations. The market could rally briefly but it's perhaps more prone to quick pullbacks once it separates. Thursday will be an interesting measure of the Saturn-Pluto square as the Moon will conjoin Saturn in sidereal Virgo before the close in New York. This combination of energies represents solitude and isolation so it may be more difficult for investors to feel comfortable with their positions. In addition, I think the hardship symbolized by the Saturn-Pluto aspect may correspond with a rebound in the US dollar very soon. All that coldness and cruelty could have investors rushing back to safe harbours.

Stocks pummeled by Sun-Mars aspect

Stocks moved lower last week on recovery worries and poor US consumer data. Despite Thursday's rally on the upbeat Q3 GDP numbers, the New York market fell 4% as the Dow closed at 9712 and the S&P at 1036. Meanwhile, Mumbai tumbled 6% on disappointing Q2 results as the Nifty closed at 4711 with the Sensex finishing at 15,896. This bearish result was in keeping with last week's forecast as the double dose of malefic debilitation from the Sun-Mars square contributed to the anxious mood. The tension inherent in the Sun-Mars tandem was powerful enough to counter much of the optimism of the passing Venus-Jupiter aspect. Monday started higher in New York on the Moon-Jupiter conjunction but selling soon engulfed the rally faithful. Thursday's 2% bump came on the same day as the exact Venus-Jupiter aspect so that is one possible explanation for it. Not surprisingly, its effects didn't last long as the market sold off sharply on Friday as the Moon set up a nasty t-square pattern with Saturn and Pluto.

This volatility is likely to continue this week as we will see more potential planetary trouble spots. Monday's Full Moon in sidereal Aries occurs at the tail end of a difficult Mercury-Mars aspect, a very dangerous combination that could prove anathema to investor confidence. At the same time, however, Venus will form an aspect with Rahu, Uranus and Neptune which may offer some support. While otherwise positive, its simultaneous occurrence here may not be enough to bring sellers back into the market. As the Moon enters Taurus late Tuesday, the Sun and Mercury will form a conjunction at 18 degrees of sidereal Libra in midweek. This is normally a favourable combination for stocks so some kind of bounce back is to be expected. Of course, the other medium term influences look less positive so it's unclear how much lift this configuration can generate here. Friday looks like more skittishness as Mercury will fall under the minor aspect of Saturn, especially in New York.

The long-awaited correction seems to be fully underway now. The bearish promise of the Saturn-Pluto and Ketu-Uranus aspects would tend to suggest that we're going to see a decline that is larger than a standard-issue 10% dip. Even with some optimism returning for the Jupiter Neptune conjunction in early December, there's good reason to think this 7-month rally is undergoing some fundamental transformation.