Summer's gone: what's next for stocks?

(3 September 2018) As the summer winds down, the US stock market appears as unstoppable as ever.  With the exception of the Dow, most of the main indexes hit fresh all-time highs last week.  Investors have generally shrugged off trade worries and instead focused on growing corporate earnings and the Fed's promise to raise interest rates gradually.  With the notable exception of India, markets outside the US have generally fared less well as more trade dependent economies such as China and Europe have suffered significant losses this year.

So what happens next?  From a technical point of view, there is good reason to think that stocks will likely undergo some kind of pullback or correction in the coming weeks.  Pullbacks are normal occurrences in a bull market, even one that is entering its 10th year as this one is.  The astrological perspective also strongly suggests that a pullback will occur in September and could begin as early as this week.

The current planetary situation is complex.  We can see powerful multi-planet alignments centered around both Jupiter and Saturn.  Bullish Jupiter has been in a very slow-moving and long-lasting alignment with Neptune throughout summer.  Jupiter's direct station in early July formed a close angle with Neptune which remained within range for two months.  This is one of the reasons for the extended summer rally.  Now Jupiter is moving away from its 120-degree angle with Neptune so there will likely to be a reduction of optimism in the weeks ahead. Jupiter is also due to align with Pluto next week (exact September 12) so that could coincide with some upside.

However, bearish Saturn is becoming more prominent in September as it stations direct on September 6 and aligns with Uranus for much of the month.  The added twist here is that the ongoing Saturn-Uranus alignment will align with Mars and Ketu, the South Lunar Node, later in September.  This four-planet alignment looks quite tense and seems incompatible with a stock market rally.  More likely, it will mark some kind of pullback.  While the alignment is exact in the second half of September, it could begin to be felt somewhat before and after the dates of maximum alignment.

Using the horoscope of the NASDAQ, we can see how this very nasty Saturn-centered alignment could make a big impact on stocks, especially tech stocks.  Saturn is stationing at 8 Sagittarius which is exactly trine the Ascendant at 8 Aries.  Saturn also conjoins Venus (9 Sagittarius) for the month of September.  Uranus (8 Aries) will also conjoin the Ascendant and hints at the possibility of sudden, large moves in the markets. 

Saturn-Uranus don't have be bearish and indeed they have been within range for several weeks already during which time the market went up.  But Jupiter was stronger than it is now.  The other area of concern is that Saturn-Uranus will be joined by Mars and Rahu.  I would think some kind of decline is likely, possibly larger than many bullish investors expect. 


This Week

Aside from the slowly evolving Saturn situation, Mars is due to aspect Mercury via its most malefic 210 degree/8th house aspect.  This is a fairly reliable indicator of some major downside (>1%) on at least one day this week.  It is close from Tuesday to Thursday so some selling looks likely at some point across those three days.  Tuesday looks somewhat worse than Wednesday, while Thursday may be the worst of the lot given the Moon-Mars opposition that also occurs that day.  On Friday, Mercury aligns with Saturn and Uranus in a Grand Trine pattern and could produce a significant move. 

The last time we saw a fast-moving planet form a Grand Trine was on August 24 when the Sun aligned with Saturn and Uranus.  While not quite exact in its alignment, the markets rose sharply that day.  We could well see a repeat this Friday.  At the same time, the Sun-Neptune opposition on Friday looks less positive and suggests confusion and lack of confidence.  So there is a lot going on there that could argue for either a gain or decline.  Or even both in quick sequence.

For more details on the short and medium outlook for the markets, check out my weekly investor newsletter.  I cover US and Indian stock markets, as well as gold, oil, and major currencies.

The astrology behind the McCain-Trump feud

(27 August 2018) The passing of Republican Senator John McCain on Saturday has highlighted the deep divisions in US politics.   McCain was one of the longest-serving and most respected Senators who was known for his sense of honor and human decency and his ability to rise above partisanship when necessary.  He also staunchly opposed President Donald Trump and the changes he has wrought in the Republican Party. Trump's ascension to the White House has transformed the GOP from a "big tent" right of center party into a vengeful, ethno-nationalist populist party. 

There was no love lost between McCain and Trump.  Trump famously insulted McCain during the 2016 campaign when he cast aspersions on McCain's long captivity and torture in North Vietnam.  But McCain got the better of Trump when he delivered the famous 'thumbs down' deciding vote against the GOP's repeal of Obamacare in July 2017.  Trump has maintained his disdain even with the death of McCain as he never even mentioned his name in the official White House announcement of his passing, let alone offer any praise for his life of public service.  Before he died, McCain also expressly stated that Trump was not allowed to attend his funeral which will be held on Saturday.  He called instead for eulogies to be given by former presidents and political rivals, George W Bush and Barack Obama.  Even in death, the bitterness remains.

It is interesting to see how this level of rancor and enmity manifests itself in the horoscopes.  While it can be useful to do a standard overlay comparison of the charts (e.g.  A's Mars is opposite B's Sun, etc.), I am currently in the thrall of Davison Relationship charts.  These are derived charts that take the temporal midpoint of the births of two people in order to cast a third chart.  This halfway mark between the dates of birth of two people is often very telling in terms of describing the nature of their relationship.  It can also give an accurate timing of events that impact the relationship through transits and progressions. 

Trump was born on 14 June 1946 while McCain was born 10 years earlier on 29 August 1936.  Their derived relationship chart therefore takes the halfway point in between -- 22 July 1941 at 7.09 p.m.  The resulting chart is very clearly reflects their mutual disdain.   Saturn is sitting on the 7th cusp directly opposite the Ascendant.  Cold, austere, no emotional connection at all.  Saturn is aspected by Neptune-Rahu very closely and thus makes the Saturn influence even more harsh, unbending, and unusually intense. 

The other thing to notice is that Venus is also part of that large Saturn alignment as it sits up in the 10th house in a close square with Saturn.  While it would be tempting to think that this strong, angular Venus might somehow offset the exaggerated and harsh Saturn influence, it actually makes it worse.  A Venus-Saturn square nullifies all the pleasant, social Venus side of a relationship.  The fact that it is highlighted on the angles with the Ascendant in focus adds an additional layer of cold detachment.  Since the Venus-Saturn-Rahu-Neptune alignment is so closely aligned with the Ascendant, it may well reflect the public nature of their mutual dislike.  The angularity of the planetary alignments pushes those qualities into the public sphere.  As a result, Trump and McCain are famous for hating each other. 

The Moon-Mercury conjunction in Gemini in the 8th house is almost exactly squared by Mars.  This is clearly a relationship characterized by conflict, frustration and anger.  A close Mars aspect to either the Moon or Mercury would have been sufficient to generate some conflict but this is a double whammy since both the Moon and Mercury are subject to the energy of Mars.  It is difficult to imagine a more hostile alignment of planets between two people.

At the time of McCain's deciding vote against the GOP Obamacare repeal, Rahu was sitting near the 10th house cusp conjunct Venus and activating that Saturn alignment.  Since Rahu is the planet of disruption and surprises, this placement was an apt reflection of the sudden nature of McCain's vote.  It wasn't clear how he would vote until prhaps an hour before the roll was taken.  The Sun-Mars conjunction at 10-11 Cancer was exactly conjunct natal Pluto, the planet of power and coercion.  Clearly, this was McCain's power play against Trump as he stuck to his principles.  The vote was the political defining event in their troubled relationship.

The upcoming funeral on Saturday, 1 September also should highlight their rancorous relationship.  The near-stationary and powerful Mars is in close opposition to the Sun suggesting that the memorial service will be another instance where their mutual dislike will be on display.  Venus will be conjunct the cusp of the 12th house of loss and isolation.  This symbolizes the absence of any Venusian sense of sociality or mutual empathy.  Mercury's placement near the top of the chart could represent how their dysfunctional relationship will be communicated and shared with a wider audience through the media coverage of the event.


Weekly Market Forecast 

Stocks have continued to march higher as the summer nears its end.  Most of the major US indexes have hit all-time highs, with the notable exception of the Dow Jones Industrial Average.  I thought we might have seen some weakness come into the market last week as we approached the Full Moon and the Mars direct station. That really hasn't happened yet, however, and Monday's rally on the possible NAFTA breakthrough did not hint at any imminent declines. 

While stocks could rise a bit further from here, I still think the clock is ticking on this rally.  The time around the Saturn-Uranus-Rahu alignment in September is likely to shift the market logic.  Saturn is due to station direct on 6 September so that first week of September is definitely one to watch.  But this week there is more of a mix of alignments.  Today's gain was fairly predictable on the bullish Moon-Mercury-Jupiter alignment.  Tuesday looks much less positive, however, so we could see some profit-taking and some downside.  Wednesday also looks suspect as the Moon will still be close to Full and also in the 8th house from the Sun.  I wouldn't expect anything too dramatic this week but maybe the tides will begin to turn on the market.

For more details on the short and medium outlook for the markets, check out my weekly investor newsletter.  I cover US and Indian stock markets, as well as gold, oil, and major currencies.

US midterm elections: can the Democrats win?

(21 August 2018) As the summer winds down, attention is shifting towards the US midterm elections in November.  These elections will be particularly important this year since they will largely be a referendum on the turbulent Trump presidency.  Currently, the Republicans control both houses of Congress as that has helped Trump to implement his agenda.  But if the Democrats win the House and possibly the Senate, then Trump would be hamstrung and effectively neutralized.  It would also likely mean that impeachment proceedings would begin in early 2019. 

At the moment, most analysts believe the Democrats are likely to win the House of Representatives.  The political betting site Predictit.org puts the odds at 67% while Fivethirtyeight.com gives it a 75% probability.  A Democrat win of the Senate is more unlikely with around just a 25% probability. 

My readings of the horoscopes of the key players suggest that the Democrats are likely to do well in the elections on November 6th.  For starters, President Trump's chart looks difficult at that time.  Transiting Mars (0 Aquarius) will be squaring his MC/10th house cusp indicating stressful situations relating to career and status.  Mars will also oppose its natal position in the 1st house and align with Saturn and Venus in his 12th house.  None of these hits suggest winning bigly.  Rahu (North Lunar Node) will be conjunct his 12th house cusp representing loss.  This is often a bad transit which correlates with disruptive events that break with the status quo and cause disappointment. 

Jupiter will be transiting his 4th house cusp in November so that could be a saving grace.  Maybe the GOP holds on to the Senate with this transit.  And yet Jupiter hits are no guarantee of positive results, especially when the rest of this chart is this afflicted.  Jupiter is often weaker at the bottom of the chart and could represent a turning inward (4th house = mind) as a consequence of negative events in the world.

The other thing to remember about Donald Trump's chart is that he enters his Jupiter-Saturn dasha period on November 19 according to the Krishnamurthi ayanamsha.  For the duration of his presidency, he has been running the much stronger Jupiter-Jupiter dasha.  As of November, he should have a worsening of fortunes over the next 2+ years.  Saturn is poorly placed in his 12th house, albeit next to Venus.  This dasha period could bring about separation or divorce from his wife Melania since Saturn is conjunct Venus, the planet of marriage.  The 2018-2020 period may also be a time when secret 12th house matters involving women and sex (Venus) bring him embarrassment and scandal. 

Compare Trump's chart with Barack Obama, the former Democrat president.  If Obama's horoscope is well-aspected, then it seems more likely that the Democrats will do well in the midterms.  That does seem to be the case as Jupiter (5 Scorpio) is exactly conjunct his 10th house cusp/MC which symbolizes career and status.  When benefics such as Jupiter align with this point, the person usually has good news regarding career.  As an added boost, Jupiter will aspect Obama's Mercury in November. 

Since Trump's chart looks bad on November 6th and Obama's chart looks good, it seems more likely that the Democrats will regain control of at least the House.  Therefore, the astrology would seem to support the prevailing view that the Democrats will win.  But can they also win the Senate which most analysts are saying is a long shot? 

I don't have any strong opinions on that question, although a look at the horoscope of the Democrat Senate minority leader Chuck Schumer suggests it's possible.  Schumer was born with the Sun at 7 Scorpio so Jupiter will be closely conjunct at the time of the election.  This is a very positive placement.  Also, Venus will be in aspect with his natal Jupiter in early November.  Unfortunately, Schumer's birth time is unknown so we can only use his approximated chart cast for noon. 

GOP Senate Leader Mitch McConnell's chart looks unimpressive for November.  Again, he have no birth time for him so we have to use the noon chart.  Unlike Schumer's chart, Jupiter is not aspecting any planet in McConnell's chart.  More negatively, Saturn (11 Sagittarius) will be casting its full strength 3rd house aspect to the Sun.  Moreover, it will align closely with Venus (12 Capricorn), Pluto (12 Cancer) and possibly the Aries Moon also, depending on his exact birth time.  These hits strongly suggest that McConnell will not have much to celebrate in November. 

Of course, it may not mean that the GOP loses the Senate. McConnell's chart would likely be afflicted in November anyway if the Democrats simply won the House since it would damage his party's fortunes overall. But the level of affliction hints at possibility of bigger problems than simply losing the House.  McConnell and the other GOP bigwigs likely already expect to lose the House.  This suggests that the midterm losses the GOP suffers will be greater than expected, including maybe losing the Senate. 

I will revisit this question in the coming weeks as the election draws closer.


Weekly Market Forecast

Stocks have generally been bullish thus far in August.  In fact, the S&P 500 made a new record high today at 2873 before pulling back at the close. Indian stocks have also hit records as the BSE Sensex is now trading above 38,000.  In my previous forecast two weeks ago, I thought that the rally in stocks might start to weaken last week in the wake of the New Moon.  That hasn't really happened although we did see some down days on Monday and Wednesday last week. 

So where do stocks go now?  While the bulls are very much in control, some kind of pullback also looks likely in the coming days.  The Full Moon on Sunday, August 26th is a bearish influence, as is the Mars direct station on Monday the 27th.  Therefore, the rest of the week may see increased caution.  Wednesday's Moon-Pluto conjunction is a possible signal in that regard, although Venus will be bullishly aligned with Jupiter and Neptune as well.  This could offset some of the brewing negativity.  Mars aspects the Sun again tomorrow, however, so that is an additional burden on sentiment.  I would note that Mars has been in aspect with the Sun on Monday and Tuesday already with few obviously negative effects.  Thursday's Moon-Mars conjunction looks more volatile and could turn an initially positive week into a losing one. 


For more details on the short and medium outlook for the markets, check out my weekly investor newsletter.  I cover US and Indian stock markets, as well as gold, oil, and major currencies.

Who is winning the US-China war?

(6 August 2018) The ongoing trade war between the US and China shows no signs of abating.  Last week, President Trump announced his intention to slap 25% tariffs on another $200 Billion worth of Chinese goods. China's response was muted as they only targeted $60 Billion worth of US products for tariffs.  While there is much gnashing of teeth about the possible global economic fallout of a full-scale trade war and a return to 1930s-style protectionism, so far financial markets are taking a wait-and-see approach.  At least they are in the US, where most stock indexes are again near their all-time highs from January.  The Dow Jones is comprised of more trade dependent companies so it has been lagging the NASDAQ and S&P 500.

But Chinese stocks have fared much worse and have actually entered a bear market as the Shanghai Index (SSEC) has fallen more than 20% from its January highs.  While global markets all sold off sharply in January, it should be noted that Trump announced the first tariffs on Chinese goods on January 23 as part of his "America First" economic policy.  Much of the global decline can be attributed to this action. 

As the SSEC price chart shows, this coincided closely with the decline.  One reason why tariffs have hit China harder than the US is because its economy is more trade-dependent.  Financial markets believe the US is in a better position to ride out any ongoing trade tensions, especially if its domestic growth remains stronger than the rest of the world.

The Davison relationship horoscope for the US and China aptly reflects this growing trade dispute.  The US-China relationship chart cast for the temporal midpoint of 17 February 1863, was under considerable stress in January when Ketu (South Lunar Node) was conjunct the Moon-Mercury conjunction (22 Cancer), very close to the 7th house cusp.  Ketu disrupts and interrupts the status quo and is usually seen as a malefic influence.  Mercury symbolizes commerce and the Moon represents collective mood and mindset.  Therefore, we can see that Ketu's transit of this very powerful and close conjunction of the Moon and Mercury would have significant effects.  As an additional layer of sudden change, transiting Ketu also closely aspected the natal Ketu-Uranus conjunction in the chart.

Moreover, Pluto (power, coercion, manipulation) is in a near-exact 120 degree angle with Mars, the planet of conflict, aggression and assertion.  While the 120 degree angle is seen as less damaging than a 90 or 180 degree angle, it is still a potent combination that indicates an extended time period of tension and conflict between the US and China.  In recent weeks, Saturn has been squaring its natal position (12 Sagittarius) and thus creating a climate of frustration, distrust and hardship. 


So what does the future hold?  The month of August could see some improvement in relations between the two countries as Mercury will align with Jupiter and Neptune this week.  This will align with the natal Venus (22 Aquarius) and offer the possibility of a much-sought after trade deal.  But I think there is also good reason to think that the tensions will worsen in September.  Mars is due to station direct on 27 August at 4 Capricorn and then it will approach the Moon-Mercury conjunction in September and October.  This looks unhelpful in terms of the chances for an enduring trade deal.  The Mars influence could be felt most intensely in mid to late October when the conjunction is closest. This could signify any deal falling apart or some other area of dispute arising, such as involving North Korea.

Another aspect of this situation is the afflicted chart of Chinese President Xi Jinping (15 June 1953).  Xi has been coming under unprecedented domestic criticism over the past week or two as middle and upper class investors has expressed disappointment with China's response to the trade war.  The upcoming Saturn station in September will oppose his natal Mars very closely -- within one degree -- and could indicate a very turbulent and difficult political situation for him.  It is possible that Xi himself could be forced out of power although it could also be a less serious event such as China suffering additional economic distress in financial markets. 

While it is usually a better astrological practice to expect more moderate outcomes, I would note that China's horoscope is very afflicted at this time.  The South Node Ketu and Mars are conjunct the Capricorn Ascendant while Saturn stations direct at 8 Sagittarius which is exactly on the equal 12th house cusp.  Saturn is due to square China's Sun and Mercury over the next year so that will likely reflect some ongoing disappointment and frustration with government and the economy.  I suspect that I will be returning to this topic again fairly soon as the situation develops.


Weekly Market Forecast

Stocks have moved higher since the Full Moon and lunar eclipse on 27 July.  While there was indeed the expected pullback in the days following the Full Moon, the decline was surprisingly modest.  I thought we might have seen more selling given the tense Mars and Saturn alignments around the time of the lunar eclipse.   Although disappointing, the fact that we did see at least a small pullback nonetheless confirmed the notion of relatively bearish effects around the Full Moon period. 

Now the NASDAQ is at all-time highs after Apple posted strong earnings and became the first $1 Trillion corporation.  The Dow is still lagging other indexes as it is still holding on to the 25,500 level. Stocks have rallied in recent days as we approach a more bullish New Moon.  As it happens, this New Moon will also be a solar eclipse which occurs on Saturday, 11 August.  This is a positive factor for stocks this week.  Also we can see that the Sun-Mercury conjunction after hours on Wednesday the 8th will align fairly closely with Jupiter and Neptune.  This is another generally positive influence for the week.  So the stars this week offer support to the expectation that we could see new all-time highs in US and Indian stocks.  To be sure, it is unlikely to be a straight line upwards, but there are no strongly negative short term patterns in play this week.  Next week looks more mixed by comparison so markets may finally be approaching a time of reckoning.

For more details, check out my weekly investor newsletter.  I cover US and Indian stock markets, as well as short, medium and long term trends in gold, oil, and major currencies.

Trump and Putin: a very unusual relationship

(23 July 2018) The fallout is still ongoing from last week's Helsinki summit between US President Donald Trump and Russian President Vladimir Putin.  Trump was widely criticized from both sides of political aisle for siding with Putin in his denial of any Russian meddling in the 2016 US election despite the fact that every US law enforcement agency has concluded that Russia did engage in cyberattacks in the US election in an attempt to defeat Hillary Clinton and help elect Trump.

The resulting furor against Trump has again raised questions about why Trump would be so quick to defend Russia and Putin while dismissing his country's own security experts, and indeed most sitting members of his own party.  Many observers are now publicly discussing the possibility that Putin must have damaging information on Trump, the so-called kompromat, or embarrassing or blackmail-type information that makes the Russian asset easier to control.  These range from owing billions to Russian oligarchs to the infamous pee tape.

I doubt very much if astrology has the means to discover exactly what kind of dirt Putin has on Trump.  Let's leave that for Robert Mueller and the judgment of history.  But the nature of their relationship is something that can be examined astrologically through the combined Davison horoscope.  This technique offers insights on the relationship between two people by taking the half-way point in time between their births and casting a new chart.  This chart can then be analyzed for the nature of the relationship.  It may also offer predictive insights on future developments in the relationship. 

The combined Trump-Putin horoscope is therefore cast for 10.41 p.m GMT on 10 August 1949.  In addition to the well-established Trump time (14 June 1946 10.54 a.m.), I am using the more uncertain Putin birth time of 7 October 1952 9.30 a.m.  Looking at this chart we can see the themes of innovative behaviour that interrupts the status quo through the placement of Rahu (North Lunar Node) on the Ascendant in Pisces.  A strong Rahu is neither good nor bad but is more commonly found in the charts that emphasize breaking down barriers and tradition. 

Well, that may well be an apt description for Trump and Putin who are trying to undo NATO and end US global dominance as well as undermining the Western tradition of liberal democracy.  Of course, that may apply more to Putin than Trump but with Trump it's hard to know what his goals really are.  His only loyalty seems to be to himself and enhancing his own power.   If that involves weakening the Western powers and aiding the rise of authoritarian rule, so be it.

The theme of radical and coercive applications of power is seen through the 120-degree Rahu-Sun-Pluto alignment that is exact within one degree.  Sun-Rahu charts assert a new way of doing things and can often project their egos in unusual and sometimes hidden or deceptive ways.  The Sun symbolizes power and government while Rahu represents disruption, deception with an aim towards transformation. The Pluto dimension suggests manipulation and coercion without regards for rules.

The deception theme is also strongly implied by the exact Mars-Neptune 90-degree square that roughly aligns with the 1-7 axis.  Neptune is like Rahu in that sense, as it can distort intentions when it is in a negative angle with other planets as is the case here with Mars.

The other main placement worth noting is the Moon in the 12th house opposite Saturn.  The Moon in the 12th house suggests a hidden or behind-the-scenes quality to the relationship that can result in penalties or punishment in some way if the chart is afflicted.  This more negative reading of the Moon in 12th is due to the harmful influence of Saturn.  To me, this is confirming the secret nature of the relationship and one whose illegal means will eventually be revealed. 

These relationship charts also offer uncanny insights into timing.  The Helsinki summit took place on 16 July and we can see that Jupiter had just stationed at 19 Libra direct in a perfect trine, 120-degree aspect with the Moon and Mars in the natal chart.  This is typically a very positive Jupiter transit that reflects the coming to fruition of the relationship.  In other words, it seems likely that both Trump and Putin got what they wanted. 

Of course, transiting Neptune is also closely conjunct the 12th house Moon here and reflects the shady and perhaps imperceptible nature of the relationship at this time.  Neptune conjunctions can be favourable influences, although this is less likely here where the 12th house Moon is clearly damaged.  Neptune in conjunction with the Moon signifies delusion, deception and scandal.  Neptune moves slowly so the conjunction will persist through the rest of 2018 and into 2019 so the whole Trump-as-Russian asset theme is likely to go for a while.  But I guess we don't need astrology to know that.

And so what does the future hold for the Trump-Putin relationship?  It is quite possible it could escape careful scrutiny for a few more months but the chart comes under greatly increased stress in January.   At that time, Saturn will be in the 10th house and oppose Mars as well as casting its 3rd house/60 degree aspect to the Moon.  Saturn rules the 12th house of secrets and penalties, so its transit to the 10th house of power is more likely to expose some of the more nefarious characteristics of the Trump-Putin relationship. 

At the same time, Ketu (South Lunar Node) will be conjunct Jupiter in the 10th house.  This is usually a difficult transit that undermines the assumptions and philosophy of an individual.  Here I would interpret to mean that their way of working together is going to suffer a significant setback.  Saturn will then go on to station retrograde at the end of April almost exactly square the Ascendant and exactly quincunx the Sun.  Ketu and Pluto will also be there in close attendance.  This looks like the end of the relationship in its current form.  This is a very negative alignment that supports the notion that the hidden secrets of the Trump-Putin agreement will be exposed and most likely punished in some way.  This occurs right before the time that I had noted for a possible resignation or impeachment for Trump.  I thought that Trump is more likely to leave office sometime in the summer of 2019.  Perhaps this somewhat earlier affliction to the relationship chart in the spring offers a clue to a possible sequence of events where either Mueller or Putin pull the rug out on Trump first and then he is forced out in the summer. 

It seems incredible that The Trump Show will finally come to a merciful end but the planets do make a decent case for it.  We shall see how it all plays out.


Weekly Market Forecast

Stocks have been moving sideways over the past few sessions as Q2 earnings season has begun.  The Dow made an interim high last Wednesday at 25,215 but has been slipping ever since.  The BSE Sensex has fared better as it closed at a new all-time high today.  In my previous market forecast on 12 July, I had suggested that stocks could rise a bit further but would be more vulnerable to declines late last week and this week.  This has been only partially correct as the pullbacks in the US indexes have been very modest so far. 

Nonetheless, I did not expect too much downside just yet since the key alignments are not yet in place.  This week looks more vulnerable to declines since Friday's Full Moon and lunar eclipse will carry a lot of potentially bearish baggage from the Sun-Mars opposition.  This is a nasty pattern this is likely to coincide with one or two significant down days this week and possibly into next week.  We could still see higher prices tomorrow (Tuesday) since the Moon will not yet be in conjunction with Saturn.  In that respect, Wednesday looks worse.   While our attention may be mostly focused on this Friday's Full Moon, the Saturn-Mars-Uranus alignment will be in effect well into next week and so we could have a longer period of higher than normal volatility.

For more details, check out my weekly investor newsletter.  I cover US and Indian stock markets, as well as short, medium and long term trends in gold, oil, and major currencies.

US stocks hit new highs on New Moon

(12 July 2018) This year it's all about the Moon it seems.  Financial markets have been under significant pressure in 2018 from rising interest rates in the US and the imminent threat of Trump's trade wars.  But it has been the Moon that has had the final say.  Since the beginning of the stock market correction in January, stocks have risen and fallen in sync with the phases of the Moon. 

As I suggested in a previous post on the effect of the Full Moon, stocks have generally made significant lows around the time of the Full Moon.  Conversely, stocks have made interim highs right around the time of the New Moon.  This cycle has been more pronounced in US and European markets.  Since the lunar cycle lasts about 29-30 days, we have seen a repeating pattern of stocks rising for about two weeks into the New Moon and then falling into the Full Moon.

There has been solid statistical research on the effects of lunar phases on stock prices which bears out this pattern across many cases.  It is an empirical reality that cannot be easily dismissed, although the possibility of a self-fulfilling prophecy always exists.  But why it should be so pronounced and so obvious this year is harder to say.  I know that each time stocks pulled back around the Full Moon, there were also corresponding bearish planetary alignments.  The twin effects of the bearish Full Moon and different negative alignments likely exacerbated the usual lunar cycle.  Positive alignments have conversely tended to occur leading up to the time of New Moons.

And so we find ourselves on the eve of another New Moon tonight just before midnight EDT 12 July 2018.  Actually, this New Moon is also a partial solar eclipse so that could introduce some added tension to the mix. To be honest, I don't think that eclipses are all that bad.  While they have been traditionally regarded with dread and fear, their impact on financial markets is quite mixed.  Many eclipses have no effect at all, and some eclipses have been positively bullish for stock markets.  As a single variable, therefore, eclipses are not reliable predictors of any particular financial or political outcome.   Of course, not all eclipses are created equal.  Some solar eclipses -- and New Moons -- are more benefic than others due to the particular alignment of the other planets.  But that is a more detailed analysis best left for another day.

So will stocks swoon once again in the coming days after the New Moon?  I think it's quite likely.  Eventually, I would expect this lunar phase correlation will weaken with time but maybe not just yet.  The key co-factor is the other planetary alignments at the time of the New Moon.  As the chart below shows, there is a celestial tug of war of sorts between bullish Jupiter and Neptune and bearish Saturn and the North and South Lunar Nodes, Rahu and Ketu.  Jupiter just stationed direct on Tuesday and thus there was another reason for stocks to rise this week in addition to the approach of the bullish New Moon. And with Jupiter now slowing moving towards its 120 degree aspect with Neptune, there could be more optimistic  sentiment available to push stocks higher later this summer.  

However, the Saturn-Rahu/Ketu alignment is made worse by Mars.  Mars is retrograde and it is currently approaching its conjunction with the South Lunar Node, Ketu.  Weighing the respective effects of these off-setting energies is not straightforward but certainly we should acknowledge there is added risk in the days ahead.  And since we are now approaching the bearish Full Moon (and lunar eclipse) on July 27th , there is another reason to think that stocks will continue adhere to its pattern in the near term and tend to decline for the rest of this month.

So when might stocks start to fall?  Today saw the NASDAQ hit a new all-time high while the S&P 500 made an important new interim high.  As we can see from the price chart, the New Moon doesn't mark the exact days of interim highs.  In June, the New Moon occurred two days after the high while in May stocks made an interim high four days after the New Moon.  And April's New Moon occurred two days before the interim high for that month.

So there could be a grace period of a few days here before the next move lower begins.  I would nonetheless expect stocks to start to fall next week at some point.   For more details and possible market scenarios, check out my weekly investor newsletter.  I cover US and Indian stock markets, as well as short, medium and long term trends in gold, oil, and major currencies.

Born on the 4th of July: the year ahead for America

(4 July 2018) Many Americans are celebrating Independence Day today in an atmosphere of heightened anxiety and uncertainty.  While the Trump presidency has won its share of supporters who like his tough talk on trade, geopolitical isolationism, and anti-immigrant policies, most of the country still feels a mix of unease, fear and anger with the new direction of the country.   Trump seems determined on remaking the post-WW2 Pax Americana into a more unpredictable global regime where the US follows its narrower and more immediate self-interest regardless of the long-term consequences.

On this 4th of July, it is worthwhile to look at the Solar Return (SR) or Varshaphal horoscope for the USA to glimpse into possible trends for the year ahead.  While there is some dispute about the exact time (and even date in some cases) of the USA horoscope, I prefer the one timed for 6.30 pm on 4 July 1776 by Vedic astrologer James Kelleher.  I am not 100% certain this is the correct time, but there are a number of telling hits to the chart using past events which make it at least as plausible as any other time.  In that sense, it is a workable chart, if still a fallible one.

As we know, astrologers like to consult the birthday or Solar Return/Varshaphal chart of individuals or entities. The resulting chart can give indications for dominant themes for the next 12 months depending on how planets are oriented in the chart.  The birthday chart generally follows the same rules of interpretation as standard astrology, although adherents of the Tajika approach may beg to differ. 

If malefic planets like Saturn, Mars, the Lunar Nodes, Rahu and Ketu, are prominent in some way, then the year ahead is more likely to be challenging.  Progress may be slower than expected and setbacks and suffering are more likely if these malefic planets are negatively aligned with the Sun, Moon, or Ascendant.  Malefics in bad aspect with positive, benefic planets are also more likely to translate into difficult situations.  Conversely, if benefic planets like Venus, Mercury or Jupiter are more prominent in the chart, then the year is likely to be one characterized by rewards and happiness. 

N.B. The Solar Return chart for this year is actually dated for July 8 instead of the 4th due to the precession of the equinoxes.  In order to cast a chart for the exact same position of the Sun back in 1776, it is necessary to correct for the very slow movement of the solar system around the center of the galaxy.  This movement amounts to about one degree every 70 years.

2018 Solar Return

A quick look at this year's chart shows a couple of obvious problems.  Saturn is rising in the 1st house of the Self in Sagittarius while Mars conjoins Ketu in the 2nd house of finance and opposes the Mercury-Rahu conjunction.  Saturn in the 1st house suggests a year of pessimism and caution and the likelihood of intensifying national hand-wringing.  The negative Saturn influence suggests a continued souring of the national mood and the risk of major setbacks, economic, diplomatic and military. 

With Saturn in the legal sign of Sagittarius, we could expect more pessimism surrounding the legal process, the rule of law and thus the Mueller investigation.  Since Saturn in Sagittarius effectively pushes legal matters to the forefront, we are likely to see growing concern from these contentious areas including Trump's Supreme Court appointment, the laws surrounding immigration and border protection and possibly even the legal status of the President within the US Constitution.

But the good news is that legal institutions still look strong and may well rise to the occasion despite the currently chaotic state of affairs.  Jupiter is the planet of law, and it is in a very harmonious Grand Trine alignment with the Sun and Neptune.  The Sun represents the executive branch (President) and the government more generally while Neptune here should be seen as embodying higher principles of law, including its predominance over the wishes of any single individual. 

Therefore, I take this positive pattern as a hint that the US government will remain intact and legitimate for the next 12 months. Its institutions are likely to remain vigilant against any encroachment or attempted corruption by the Trump administration.  It also speaks to the outcome of the Mueller investigation.  The "witch hunt" label so often tossed around by right wing partisans will likely be seen as merely self-interested Trumpian bluster.  It seems likely that significant criminal charges will be laid in the investigation into Russian meddling in the 2016 election. 

To be sure, other interpretations of this Sun-Jupiter-Neptune pattern are possible as the strength of the Sun with Jupiter could reflect on Trump himself as his standing may improve.  However, the afflictions in Trump's personal horoscope look bad enough that I don't think this is a likely development over the next year.  The strong Sun-Jupiter in this chart is more of a reflection of Mueller than Trump in my view.


Economy

Economic and financial matters are likely to be an increasing source of worry during the next 12 months as the Mars-Ketu conjunction in the 2nd house could correspond with declines in national wealth.  Both Mars and Ketu are quick-acting and disruptive planets, so we could see economic fortunes deteriorate suddenly.  Trump's trade war is only in its initial "negotiating" phase, but this placement suggests it is likely to get worse before it gets better.  I would expect the rising tariffs on imports and loss of export markets for US goods to eventually reduce economic growth. 

Stock markets are unlikely to escape the fallout as 2018 looks increasingly like a lost year.  Previously, I had written that stock markets looked volatile and very choppy but might be able to avoid significant damage over the next year.  But this SR chart looks more negative for investing, so I would think a negative performance for markets is now more likely over the next 12 months.   

We can compare this SR chart with the SR chart for July 4, 2007 at the start of the financial meltdown.   Here again we see the 2nd house of wealth and assets afflicted by the Moon-Mars conjunction in Aries.  Mars is the key factor here as it usually makes outcomes worse for the matters related to the house it occupies.  Since Mars is with Ketu in the 2018 chart, there is a real risk that we could not only falling stock markets (N.B. the markets peaked in Oct 2007 and fell for the next 18 months) but that the US is more likely to suffer from slowing economic growth during the next year.  A recession (i.e. negative economic growth) is a likelihood in 2019 and 2020. 


Trump and the summer of 2019

While the 2018 Solar Return chart has more than its fair share of problems, the 2019 Solar Return chart looks much worse.  The Saturn-Ketu conjunction opposes the natal Sun within just a couple degrees while the Moon (people) forms a T-square.   This symbolizes stress to leaders and possible changes in government that will create an ugly national mood.  If Trump is going to leave the presidency, this July 2019 to July 2020 is the most likely time window when it could happen.  I tend to think the summer of 2019 is the most likely time when Trump will leave office.  A forced resignation is the most likely scenario given these terrible alignments.  The Mars-Mercury conjunction square to Uranus suggests deepening economic hardship leading up to the next General Election in 2020.

Weekly Market Forecast

The stock market suffered another decline last week given ongoing concerns about a deepening trade war with China.  The Dow touched as low as 24,000 last week before rebounding slightly early this week.  India's Sensex also briefly dipped below 34,000 last week before recovering somewhat this week.  This bearish outcome was very much in keeping with last week's market forecast as I thought Thursday the 27th's Full Moon would likely correlate with more downside.  The periods around Full Moons are often bearish, and this one was particularly negative given the close conjunction of bearish Saturn. 

Well, now that we are moving towards a theoretically more bullish New Moon on 12th July, will the market resume its upward climb?  I think that's likely but the gains may be more muted and unpredictable than previous New Moons.  The rallies into the New Moons on June 13 and May 15, for example, were fairly strong (4-6%) and were more or less one-way up trends.  The current period looks more mixed and suggests that the road higher could have some detours. 

One problem now is that Mars is retrograde and will align with Saturn and the Lunar Nodes, Rahu and Ketu towards the end of July.  As a rule, the more malefic planets involved in an alignment, the higher the probability of a down market.   Mars is already just three degrees away from an alignment although I suspect it will have to move a bit closer to produce any major selling.  Moreover, the next Full Moon will actually be a Lunar Eclipse on July 27th.  With both Mars and Saturn in the mix with this eclipse, it seems likely that this bearish Full Moon pattern will continue. 

Tomorrow's (Thursday, July 5) Mercury-Mars opposition looks bearish, especially in the morning although we could see some gains later in the day and on Friday as the Sun will be aspected by Jupiter. 

Next week looks a bit more positive as Jupiter ends its retrograde cycle on Tuesday the 10th and resumes forward motion.  Mercury will align with Jupiter in the early part of the week so that bodes well for positive sentiment, at least for a couple of days. 

For more details and analysis on market trends for this week, this month and this year, please check out my weekly MVA Investor Newsletter.  The newsletter is published every Saturday and includes extended discussion of US and Indian stock markets, as well as gold, oil and major currencies.