US Stocks rise with Jupiter; Saturn waits in the wings

US Stocks defied gravity for another week as investors cheered positive earnings reports and more upbeat government data. The Dow rose 1% to close at 11,787 while the S&P500 finished the week at 1293. As expected, the bullish effects of Jupiter proved to be a durable influence on markets as its early week aspect with Mercury put stocks an solid footing. Not even the more ambiguous Mars-Jupiter aspect late in the week could upset the mood as Friday's session ended with a respectable gain.

It was a very different outcome in Mumbai, however, as inflation worries continue to undermine sentiment. New December data suggested that inflation was worsening and that increased the likelihood of a rate hike from the RBI. As a result, the Sensex lost another 4% last week to close at 18,860 while the Nifty ended Friday at 5654. India's market may have bucked the otherwise bullish global trend due to specific afflictions to the Sun in the BSE 1875 horoscope.

On the surface, it may appear that little has changed in this post-eclipse period. US and European stocks have extended the rally and taken prices to new highs. And yet a number of more speculative markets have fallen since the first week of January. Many emerging markets like India and China have fallen while a number of commodities have also been subject to declines, gold being the most noteworthy. While it is possible to regard the eclipse and the Jupiter-Uranus conjunction as non-events, I still see them as important sign posts due to the worsening of sentiment in these other markets. This is perhaps the thin edge of the wedge as the downside of the Fed's QE2 policy may be on the verge of coming home to roost. The Fed's plan to buy up treasuries has encouraged a flow of 'hot money' into riskier currencies and asset classes. This is creating serious inflation problems in Asia and they are now being forced to come to terms with it by raising rates and choking off excessive growth. Eventually, the lowered demand out of China and India will likely reduce economic activity in the US and Europe, but for now, investors are choosing to ignore this possibility. Perhaps they will be reminded of the risks of Bernanke's excessive liquidity by Saturn's retrograde cycle which begins on January 26.

This week holds the promise of another mostly positive beginning as the Sun forms aspects with Uranus, Neptune on Monday, and then with Jupiter by Wednesday. This is likely to produce some buying for at least one or two days, especially in markets which have been bearish like India's. Gold may also benefit from this Jupiterian influence on the Sun. With US markets closed for the MLK holiday on Monday, however, some of this upside may be more muted there. The midweek Mars-Ketu aspect may nullify some of this enthusiasm so it is quite possible that optimism may fizzle with sellers prevailing into Thursday as the Moon opposes Mars. In other words, there is a good chance we will see more upside before any profit taking. But as Saturn slowly grinds to a halt in the sky ahead of its retrograde station, there is also an increased risk of more negativity here. Saturn is waiting in the wings for its moment on the stage.

Gold falls after eclipse; Mercury-Jupiter this week

Stocks in New York edged higher for another week as better than expected manufacturing data fueled hopes for a sustainable recovery. The Dow gained 1% to close at 11,674 while the S&P500 ended the week at 1271. Not surprisingly, the biggest rise came from Monday's Venus-Jupiter aspect with the market gradually weakening after that. The combination of Tuesdays' solar eclipse and Jupiter-Uranus conjunction had little immediate effect on equities, although it did send commodities such as gold and oil down sharply. Gold lost more than 3% for the week and finished below $1370. As expected, the late week Sun-Saturn aspect did exert a drag on sentiment as we saw modest declines on both days.

It was a more dramatic story in Mumbai, however, as Tuesday's eclipse appeared to divide the trend with gains on Monday's Venus-Jupiter aspect and then losses prevailing thereafter. The Sensex closed below the 20 K level at 19,691 with the Nifty finishing at 5904. Friday's sizable decline coincided closely with the Sun-Saturn aspect as this pairing often marks a loss of confidence and rise in pessimism.

So while most global stock markets appeared to have shrugged off the solar eclipse and the culmination of the Jupiter-Uranus conjunction, we may have seen a possible turn in commodities as they moved lower across the board last week. Whether or not they remain weak in the days and weeks to come is an open question. With Jupiter's optimism now in shorter supply, it may be harder for commodities to make speculative gains in this post-eclipse and post Jupiter-Uranus environment. The other additional factor to consider is, of course, Saturn. If Jupiter is the gas pedal, Saturn acts as the brake. The markets may have lost some of Jupiter's gas here in January but Saturn is due to put on the brakes. Saturn begins its retrograde cycle on January 26 and it promises to be a significant period owing to the concurrent bad aspect with Mercury. Remember that Saturn began its retrograde cycle in May 2010 while in bad aspect with Venus and then Jupiter -- just as the market was undergoing a major correction. While nothing is certain, it definitely is a pattern that warrants further watching.

This week features some minor aspects involving the Jupiter-Uranus conjunction so that tilts the table towards gains. The early week is perhaps more positive in that respect as Mercury is in square aspect with Uranus and Jupiter on Monday and Tuesday. Mars then takes the reins for the rest of the week as it aspects this bullish planetary duo. Mars is a more unpredictable factor than Mercury, however, so the probability of late week gains is somewhat lessened and indeed losses are also quite possible. Perhaps "mixed" is the word that best sums up the situation.

Jupiter conjoins Uranus; Solar Eclipse due on Tuesday

US Stocks tread water in the last week of 2010 as economic data supplied mixed signals in quiet holiday trading. The Dow was unchanged at 11,577 while the S&P500 ended the week at 1257. Indian stocks fared somewhat better as the Sensex rebounded after early weakness and closed 2% higher at 20,509 with the Nifty finishing the year at 6134. I thought we might see more downside from the Mars-Saturn square but there was only a very mild hiccup in Mumbai, although Chinese equities did appear to suffer early in the week. The late week period was generally more bullish on the Moon-Venus conjunction, although not all global markets participated and the US in particular stayed mostly flat.

The continued market effervescence is perhaps more in keeping with the approaching Jupiter-Uranus conjunction. These two planets have been bullish dance partners in sidereal Pisces since mid-2010 as they have rarely been more than a few degrees away from each other. The optimism of Jupiter and the risk-seeking of Uranus have combined to fuel the substantial rally in the second half of the year. Once the conjunction culminates exactly on Tuesday, January 4, this bullish pairing will not conjoin again until 2024. Obviously, their distinctly bullish energies will interact much sooner than that through aspecting (e.g. early 2012), but another protracted period of conjunction will be a long time coming.

Curiously, a solar eclipse at 19 degrees of sidereal Sagittarius is also slated for 3.50 a.m. EST on Tuesday. This is an intriguing coincidence of phenomena which increases the possibility of major new developments, including the prospect for major trend changes in the days to come. Eclipses are famous for stirring things up and interrupting the status quo, so we will have to see what kind of effects may manifest here.

The week will also feature a number of close planetary aspects. Benefic Venus is aspected by Jupiter early in the week so that generally boosts confidence and encourages buying. But Mercury and Mars are also in fairly tight aspect through much of the midweek period so that may let some air out of the balloon, especially after the eclipse has passed. The Sun is in a partial strength square aspect with Saturn on Thursday and Friday and that should also be seen as a negative influence on sentiment. Sun-Saturn aspects often have a special relevance for gold, and prices often fall near their aspects.

Markets drift higher; Mars-Saturn this week

Stocks edged higher last week as retail and housing numbers continued to show improvement and boosted hopes for the recovery. In New York, the Dow rose about 1% to close at 11,573 while the S&P500 finished the holiday-shortened week at 1256. It was much the same story in Mumbai as the Sensex added modest gains before closing at 20,073 with the Nifty standing at 6011 at the end of Friday's session. The universe unfolded more or less as expected as the early week Mercury-Jupiter-Uranus aspect pushed stocks a little higher ahead of the Christmas break. Predictably, some of the enthusiasm faded by week's end as Venus was damaged by bearish Saturn. Indian stocks also gained ground early in the week but failed to get above some important resistance, although they did manage a modest gain on Friday.

Tuesday's lunar eclipse garnered a lot of media attention, mostly because it happened to coincide with the winter solstice for the first time since 1638. I'm not sure this means anything special, although it may be more significant that the eclipse occurred when Mercury was in square aspect to Jupiter and Uranus. This bullish trio of planets can lift sentiment but the eclipse would almost seem to negate or even reverse that influence since eclipses are celestial mechanisms of interruption where the status quo breaks down.

The next eclipse in the current pairing arrives on January 4, 2011, just as Jupiter is in exact conjunction with Uranus. It's quite a coincidence to be sure, and greatly increases the chances for some big changes in our economic assumptions such as how risk is assessed and how future earnings are calculated. Jupiter (optimism) and Uranus (risk) have been in close proximity for the past four months and that has been a major reason for the sustained rally from the summer lows. Once Jupiter separates Uranus, the stage will be set for a dissolution of that bullish, confident energy. While it could take place gradually over several weeks, the fact that an eclipse occurs at the same time may increase the likelihood of a sudden shift in sentiment or revision in thinking. January promises to be a very interesting time indeed.

This week will feature a square aspect between Mars and Saturn. Both of these planets are considered natural malefics so that greatly increases the probability of declines. The aspect is closest on Tuesday so perhaps that early to midweek period will be the focus of negativity. The late week period may be somewhat more positive as the Mars-Saturn aspect separates while the Moon conjoins Venus on Thursday and Friday.

Stocks edge higher; lunar eclipse due on Tuesday

Stocks edged higher last week as the Fed reaffirmed its commitment to stimulate the economy by any means necessary. The Dow closed at new highs for the year at 11,491 while the S&P500 finished at 1243. It was much the same result in Mumbai as markets rose almost 2% with the Sensex closing at 19,864 and the Nifty at 5948. While I thought we might see more downside on the Mercury-Mars conjunction early in the week, we can't be overly surprised that markets continue to rally here on the approach of the Jupiter-Uranus conjunction. The midweek aspect between the Sun and Jupiter-Uranus manifested a little early as stocks generally rose through Tuesday. The same was true for gold as it once again traded above $1400 in Tuesday's session before turning lower for the rest of the week.

So the optimism of Jupiter continues to operate in a bullish syncopation with the risk-orientation of Uranus. It is tempting to think the good times will continue all the way to their exact conjunction on January 4 2011. After all, that is in keeping with standard astrological thinking as conjunctions are most strongly felt right at the point of exactitude. But even here it is important to note that conjunctions sometimes do not act exactly as advertised. Some conjunctions peak earlier than expected due to the presence of other factors, while the effect of others last well after they are exact, as we saw with the previous Jupiter-Uranus conjunction on September 15. This not only sparked the rally off the late August bottom, but the rally continued well into November. This was perhaps due to the fact that although past exact, the retrograde motion of both planets meant that they would continue to be in close proximity (less than 3 degrees) to each other for over three months. But once the faster moving Jupiter passes Uranus on January 4, there will be no future conjunctions until 2024. So that is an argument perhaps that the upcoming conjunction may not behave as bullishly as the last one did.

As always, other facts have to be considered. One such factor is the impending eclipse period, which begins with a lunar eclipse on Tuesday, December 21. Eclipses generally occur in pairs and the accompanying solar eclipse is slated for January 4 2011. That is certainly an intriguing coincidence given that this second eclipse will fall on the same day as the Jupiter-Uranus conjunction. Eclipses are generally seen as destabilizing events which can change market direction and upset the status quo. Just as the light of the Sun is blocked or interrupted in a solar eclipse, so are prevailing trends "interrupted" by solar eclipses. That is one reason why earthquakes and volcanoes tend to cluster around eclipse periods -- there is an upset in the Earth's status quo.

Readers may recall that the previous two eclipse series were closely implicated in market reversals. In January 2010, the market topped in the US on January 19, just four days after a solar eclipse, and then tumbled more than 10% over the next three weeks. The solar eclipse followed a preceding lunar eclipse which had occurred on Dec 29. The next eclipse period happened very close to the US market bottom on July 2, as a lunar eclipse occurred on June 26 and this was followed by a solar eclipse on July 11. In light of the tendency of eclipses to reverse trends, there is additional reason to think that the current rally and underlying optimism surrounding the market may be "interrupted" quite soon. The fact that the solar eclipse falls on the same day as the completion of the Jupiter-Uranus conjunction only adds to the likelihood that changes are afoot.

Besides Tuesday's lunar eclipse, this week will see Mercury forming aspects with Uranus and Jupiter. Since all three of these planets are nominally positive energies, there is some reason to expect more upside, presumably earlier in the week when the aspects are closest. After Tuesday, however, the positive effects of these aspects will likely wane and caution may soon move in on the Venus-Saturn aspect later in the week. Sentiment is likely to get even more cautions and perhaps downright tense in the week after Christmas as Mars squares Saturn.

US Stocks drift higher on Jupiter-Uranus; Mercury runs gauntlet this week

Stocks in New York drifted higher last week as favorable economic data supported the belief that the recovery is 'just around the corner'. The Dow was slightly higher at 11,410 while the S&P500 fared somewhat better closing at 1240, its highest level since 2008. Indian stocks were lower, however, as domestic inflation concerns and the outbreak of more financial scandals sent investors to the exits. The BSE Sensex tumbled more than 2% to 19,508 with the Nifty finishing at 5857. Meanwhile, gold fell back below $1400 last week as currency worries were put on the back burner. I had pointed out the probable negative effect of the early week Sun-Saturn aspect and all markets were generally weaker at that time, although Mumbai continued to fall through Thursday, possibly due to natal afflictions. Gold's decline arrived more or less on schedule with this aspect as prices tumbled more than 2%.

As most global markets inch higher here, we may well be seeing the "glass half-full" thinking that comes with Jupiter-Uranus conjunctions. Now that Jupiter is only two degrees away from Uranus, most markets are choosing to not "fight the Fed" and just get on board with all the cheap money Bernanke is injecting into the financial system, regardless of the downstream consequences. Jupiter's confidence and optimism is combining with Uranus' love of excitement and risk-taking to create something of a monster that has lost its sense of caution and fear. Well, it's all fun and games until someone loses an eye. The exuberance of Jupiter with Uranus may be seen as an astrological equivalent of a bubble. Even as more commentators openly question how long this game of musical chairs can go on, the bubble continues to be inflated. When will it pop? One possible answer might lie in the date of its exact conjunction on January 3, 2011. Once conjunctions are exact, they begin to lose energy as the planets separate. This is a general rule of thumb, however, as other influences must also be factored into the overall equation. Certainly, we are getting pretty close to that point where the balloon cannot expand any further without popping.

This week we will see the immediate effects of the bearish quadruple conjunction of Mercury, Mars, Rahu and Pluto. While this alignment has not been very negative in the US, it has had more impact in Asian markets where the negative effects of the inflation of Jupiter-Uranus is in full view. Mercury may be the key planet to watch here as it symbolizes trading and information flows. Now in its retrograde cycle until Dec 30, Mercury will conjoin Mars and Pluto early in the week with its closest pass on Tuesday. Around the same time, however, we will have a more bullish Sun-Jupiter aspect that is likely to boost confidence. Its effects are perhaps more likely to arrive midweek. Gold may be benefited in particular by this Sun-Jupiter aspect. The late week period looks mixed as Mercury suffers from its contact with Rahu on Thursday but the Sun teams up with Uranus which could spark more speculative interest.

Stocks rise on Mercury-Venus

Despite another disappointing US employment report that, stocks rebounded last week as the European debt crisis showed signs of coming under control. In New York, the Dow gained 3% on the week closing at 11,382 while the S&P500 finished at 1224. It was a similar tale in Mumbai as the BSE Sensex rose 4% closing at 19,966 and the Nifty at 5992. Last week, I had noted the unreliability of Monday's Mars-Jupiter aspect. This combination was often bullish due to its symbolism of excessive risk but it seemed less conducive to gains in the current climate. While we saw gains in Asia on this aspect, much of the rest of the world was modestly lower. The midweek pairing of Mercury and Venus delivered gains more or less as expected across the board as Wednesday saw prices climb sharply. The end of the week saw an ebbing of enthusiasm, although it was nowhere near as negative as the aspects would have suggested. The proximity of Mercury with Rahu and the Mars-Uranus square seemed to portend bigger moves than what we got. Since Mercury is slowing down in advance of its retrograde cycle which begins this Friday, some of the confusion and uncertainty from this Mercury-Rahu conjunction could conceivably be protracted over several days.

The world is awash in debt these days with stimulus plans, bailouts, and of course the Fed's QE2 program of quantitative easing. The aim of all these market interventions is to restore confidence, boost demand and economic activity, and avoid losses that would otherwise result if the market was left to its own devices. These are all understandable and commendable actions and yet with each new bailout comes an increased risk of inflation and debt default. Inflation occurs because too much money is being printed relative to the amount of value produced by an economy. In an attempt to restore economic confidence in indebted companies and countries, there is a risk that inflation will devalue fiat currencies and paper money. This is the main reason why the price of gold has been rising, as it once again closed above $1400 last week, and why money has been pouring into stocks of late. With the likelihood of currency debasement down the road -- as this risk-loving Jupiter-Uranus thinking goes -- it makes more sense to be invested in the stock market. But the risk of default is also growing as the amount of outstanding debt continues to mount. As a reflection of this increasing supply of debt, yields on debt are starting to rise all over the world. This is even happening with US Treasuries despite the Fed's buy back program. If bond yields continue to rise, it will begin to set off alarm bells as the debt will become too expensive to service. The danger here is that if yields continue to rise it could start chain reaction of ever-greater borrowing to pay the interest, higher inflation, devalued currency, and ultimately economic collapse. Bailouts are often necessary, but they are not risk-free.

This week begins with Jupiter entering Pisces (actually on Sunday), a Sun-Saturn aspect and a Uranus direct station. Jupiter entering a new sign is usually a bullish indication and it is now just two degrees away from Uranus. While their exact conjunction is still four weeks away, this is background influence is bullish, albeit somewhat diffuse. However, Sun-Saturn aspects usually sap confidence so this is often a difficult influence in the short term. Gold is also susceptible here since the Sun is its planetary significator. With Uranus returning to forward motion this week, there is a greater chance for sudden developments which may change some prevailing trends. When Uranus last changed its direction on July 5, the market had formed an important low just 3 days before. The midweek period features a Venus-Pluto aspect which will eventually blend into a Mercury-Venus aspect by the end of the week. These are usually positive influences. However, Friday's close Mars-Rahu conjunction is not a bullish combination and increases the chances for uncontrolled bursts of energy, irritation and hostility. The formation of the quadruple conjunction of Rahu (distortion, greed), Pluto (power,control), Mercury (communication), and Mars (action, urgency) over the next week or two is an unusual and awkward blending of energies that does not promote stability in either the financial markets or in the geopolitical sphere.