Merriman Market Analyst

Review and Preview:

Here come the grains! After dropping to a 3-month low last Wednesday, Corn was limit up and at a new 10-year high on Friday, with the March contract up to 396. This is consistent with our previous forecast made last August when Corn was under 220 (and discussed in detail in the Forecasts for 2007 book), that the alternative fuel revolution was about to get underway, and Corn could be making an all-time high by 2008. The next leg up in this new bull market has begun. Even Soybeans jumped up 42 cents per bushel on Friday to close at 716 in the March contract, its highest level since the summer of 2005, after trading as low as 657 on Wednesday, its lowest level in two months.

Equity markets were also strong last week. After posting a two-week double bottom at 12,337 on Monday, the Dow Jones Industrial Average soared to a new all-time high on Friday. It wasn't matched by other indices, like the S&P, but that could change as we get closer and closer to the powerful Jupiter-Uranus waning square of January 22. With Uranus, one would expect the upward surge - and reversal - to be led by the tech stocks (NASDAQ Composite), and indeed this has been the case.

Big reversals were also noted in the precious metals last week. After falling sharply at the end of the prior week, both Gold and Silver rebounded smartly after Wednesday. Gold had tested the 600 area and Silver the 1200 mark. By Friday, Gold was above 625 and Silver was testing 1300. Crude Oil also was interesting, with the February contract all the way down to 5160 on Friday, but rebounding smartly to close up 111 points at 5299. Was that the bottom? Could be, as we are now within 9 trading days of that important Jupiter-Uranus square. As discussed last week, we look for the bottom while Saturn is in opposition to Neptune (August 30, 2006-June 25, 2007. Ideally the low would be between the first and second passes of this aspect, which is in effect through February 28, 2007. And lastly, we would expect the bottom to occur close to a major aspect involving Jupiter to a planet beyond its orbit. That next one occurs January 22, when Jupiter will square Uranus.

Monday is the Martin Luther King holiday in the United States , so U.S. markets will be closed then. Next week's report may not be available until Sunday, due to the all-day Saturday symposium on “The Next Five Years” taking place in Cologne , Germany (see announcement at end of this report). I look forward to meeting many of our European readers who have signed up for this event.

Short-Term Geocosmics:

We are now in the middle of the first big geocosmic “cluster” of planetary signatures of the year, January 8-22. These types of clusters have an 80+% correlation to reversals in many financial markets, for they are synchronistic to investor sentiment (the psychology of the collective).

This week will find Mars ingressing into Capricorn (January 16), which is one of the most powerful ingresses of all, and a significant part of this cluster. Why is that degree (0 of Capricorn) so important? Because it conjuncts the Sun of the Federal Reserve Board, which was “born” December 23, 1913. It also opposes its Pluto, which is at 0 Cancer. When major planets cross the cardinal points (zero degrees of Aries, Cancer, Libra or Capricorn), it is not uncommon to see an investor “shift of sentiment” about the future of interest rates. If the direction of interest rates suddenly takes on a new meaning, it directly impacts currency prices, which have a direct correspondence to precious metals values.

As we look at the interest rate markets - specifically T-Notes and T-Bonds - we see they have been coming down (interest rates going up). According to this ingress of Mars into Capricorn, that could now change and the perception may be that the economy could be weakening. That in turn can allow the FED to act more accommodative, thus causing treasuries to appreciate.

But Mars in Capricorn also correlates with heightened, military tensions, especially involving Israel 's security. As one might expect, Crude Oil prices could become very volatile too over the next several weeks of this ingress.

And then the following week, the even larger Jupiter-Uranus waning square unfolds (January 22), along with Venus in opposition to Saturn. What a way to start the year! Don't expect a whole lot of “bi-partisan cooperation” in governments. Expect outrage and outrageous rhetoric. Expect some brash and arrogant leaders to make some rather embarrassing pronouncements. They may look like fools, and make one wonder: how could they possibly be respected as leaders of this world? Are they really visionaries? Or completely delusional?

Long-Term Thoughts:

We are living in the midst of an incredible renaissance period - and we don't even know it. Our attention is bombarded with so much negative news that we must wonder at times how Humankind will ever survive the next decade, let alone this decade.

One of the most beautiful things about astrology is that it brings us into awareness of a multitude of cycles - cycles of planets orbiting around the Sun, and cycles of planets in relationship to one another as they makes their orbits around the Sun. These cyclical periods have remarkable historical correspondences to cycles in human activity. The extreme stress that we currently feel today can be associated directly with the oppositions of Saturn to the three planets beyond its orbit: Pluto (2001-2002), Neptune (2006-2007) and Uranus (2008-2010). These are each 36-45 year cycles, and they are culminating this decade, and about to enter their waning (down side) phase through at least the next decade. With Saturn, things seem hard. The future may seem bleak. Humanity may seem on the verge of destroying itself, and hope is hard to come by. Reality is just very... well, too real, in a fearful sense.

But these Saturn cycles are but phases themselves of the even greater cycles involving Uranus, Neptune, and Pluto to one another. And each of those three cycles are in their waxing, or “up” phases, as part of an even greater 500-year cycle. Within this 500-year cycle is the 80+-year sextile that takes place between Neptune and Pluto (1950-2032). Due to the elliptical orbit of Pluto, and one in which Pluto actually intersects the orbit of Neptune and for a few years is closer to the Sun than Neptune, these two planets stay in such a long relationship (the longest lasting planetary aspect of all) every 500 years. They did this also from 1460-1540, during the famous Italian Renaissance, when banking was no longer the loathsome sin of usury. Banking became respectable for 100 years - and then the banking empire collapsed. And in the midst of that renaissance, Uranus and Neptune came together in their 171-year conjunction, followed by their mutual reception (1478-1509). The intellectual and artistic world exploded. Not only did the world of banking, philosophy, and art have a revolution of innovation in the late 15 th century, but the world was suddenly understood as no longer flat. Christopher Columbus sailed to the New World in 1492, and the powers of the world shifted from Italy to Spain, and eventually the Dutch and English. There was a major shift of power - and money - in the world.

Now think 500 years later as Uranus and Neptune conjunct (1993), followed by their mutual reception (2003-2011). This phenomenon is tasking place once again within the Neptune-Pluto 80+-year sextile phase. Another revolution swept the planet (internet and telecommunications technology), collapsed, and is resurrecting again. New application of human innovation is again at a height - in the fields of science, arts, and even economic thought.

It is an amazing and brilliant time we are living in. But because it also such a dangerous time we live in (through next decade), we fail to appreciate it. We are cracking. But I think we will not break. And as we overcome our dependency upon black gold - crude oil (Uranus and Neptune also in mutual reception) - and find new sources of alternative energy that does not destroy our wildlife, ecosphere, world economy, and contribute to the act of killing one another, I think we can and we will pull out of this downside of the Saturn cycles. I have faith in human ingenuity and innovation, especially as I study the history of these longer-term cycles and their corresponding shifts in the human story... the same cycles that we are in from 1950-2032.

The future is in these new sources of energy. The investment opportunities will also be there. Green is in - at last. And so is electricity and corn.