Merriman Market Analyst

Review and Preview

Did I mention that the Jupiter-Uranus signature tends to be erratic and highly unpredictable with regard to market movements?

It is said that trading markets is the quickest way to develop humility – if you want to survive. It is the ultimate teacher not only of humbleness, but also of the need to be flexible in your mindset. If you aren’t, then you are as good as dead.  There is no room for error or arrogance, especially when you trade in markets during periods of Mercury retrograde or strong aspects to Uranus.

This past week, Jupiter underwent its second (of three) waning square passage to Uranus, usually the strongest of the three passages. To say that stock markets were erratic, and technical studies were unreliable, would be an understatement. In the U.S.A. for instance, the Dow Jones Industrial Average soared to a new all-time high on Wednesday, May 9, as the Sun squared Saturn. This is considered a hard aspect in astrology, and one in which most students of astrology would think would dampen the market. But instead, stocks closed strong that day, with a series of bullish technical “buy” signals. But then the next day, the DJIA fell 147 points (triple digits, as expected), negating all those bullish signals and instead turning bearish with a slew of new sell signals. But then on Friday, the market was up 109 points, negating the prior day’s technical sell signal, and turning bullish again in a technical sense.

So what do we learn from this – besides a slew of “life lessons?” We learn that squares are not always lows. The market made a new all-time high on May 9 under the Sun-Saturn square, and one day before the exact hit of the Jupiter-Uranus square. It also happened in the middle of the Moon’s three-day transit through Aquarius. Aquarius is the domain ruled by Uranus, which is part of the Jupiter-Uranus square, and therefore highlights this lunar cycle. It coincided with the all-time high (as it stands today) in the DJIA. It also coincided with a couple of other correlations derived from The Ultimate Book on Stock Market Timing, Volume 4: Solar-Lunar Correlations to Short-Term Trading Reversals. Many long-term cycle crests unfold when the Moon is in an air sign. And a good number of highs in stock indices also form as the Moon enters the beginning of the zodiac (i.e. when the Moon nears 0 Aries). The Moon will enter 0 Aries this weekend. Will the market continued its torrid pace to more new all-time highs, negating one sell signal after another, as it has done all this year with Jupiter in Sagittarius? Or will the completion of the Jupiter-Uranus square passage, and the movement of the Moon into the new zodiac, signal a change in trend this coming week? I know the answer, based on probabilities derived from past occurrences of these signatures. I just wish I knew if I was asking the right question.

The U.S. stock market was not only market that experienced a sudden change of direction, and negation of bullish and/or bearish signals last week. On Thursday, the Japanese Nikkei rallied to 17,827, its highest level in several weeks, and technically an upside “break-out” to new cycle highs. But on Friday, it gapped down, wiping out the prior day’s technically bullish close. The July Corn contract fell to 354 on Thursday, a new multi-month low, suggesting a big sell-off was in force. But on Friday, it surprised everyone by closing up over 15 cents (that’s a big move for Corn), thereby negating the prior day’s bearish signal. Gold and Silver were looking quite bullish as last week’s trading began, with Gold threatening to take out 700.00. By Thursday, that bullishness had completely evaporated as prices fell to 666, its lowest level in over a month, and now approaching a critical trend line that has supported this bull market.

Short-Term Geocosmics

We are starting to see the triple digit up and down days suggested previously as pertaining to the Jupiter-Uranus square aspect of May 10-11. But the majority of these days were up as we headed into that aspect. We now have to wonder what happens as we separate from this signature of “euphoria, exaggeration, optimism, and also panic and hysteria.” Do we see spillover to new highs for then next few days? It is possible, as that is what happened last year following the second passage of a Jupiter-Uranus signature. The stock market continued higher for one more week before commencing a decline of about 1000 points over the following 4 weeks. Gold and Silver were even more extreme. They continued making 20+-year highs also for an additional week, before falling over 30% for the next 4 weeks in the case of Silver.

As we now move past Jupiter and Uranus, we start our approach to the third and final Saturn-Neptune signature of June 25. As stated last week, and still applicable to this week, “But it is not just Jupiter and Uranus one has to be concerned about this week. In addition, the Sun will now start its translation to the forthcoming Saturn-Neptune opposition. It will form a T-square to “the other” significant geocosmic signature of this year, when it first forms the waning square to Saturn on Wednesday, May 9, and then the waxing square to Neptune on next Saturday, May 12. This Jupiter-Uranus “freight train” of a rally could spill over into this translation period before a sobering reality sets in the following week. Such a rude awakening may be further set off with Mars forming a waxing square to Pluto the day after (May 13). This later is a signature of threats again to human lives, especially through acts of terrorism.”

The other major geocosmic signature to happen this week will be Mars entering Aries, May 15 through June 24. Mars rules Aries. Both pertain to assertiveness and starting new things, new directions, and quite possibly new trends. This ingress has a strong correlation to the culmination of cycles in interest-rate related markets, like Treasury Bonds and Notes, for it aspects the Sun-Pluto opposition in the Federal Reserve Board chart at 0-1 degrees of Cancer-Capricorn.

Long-Term Thoughts

Moving from the Jupiter-Uranus dynamic to the Saturn-Neptune dynamic may not be as exciting and euphoric. The concept of “euphoria” and “confidence” belongs to the realm of Jupiter. There is a saying that markets are ruled by “fear and greed.” Well, Jupiter is the “greed” element, and Saturn is the “fear.” It would seem that from now through June, we will see the investment climate move from greed to fear, as we move from Jupiter’s influence to Saturn’s, both in terms of stock markets and world affairs.

As Saturn also rules accountability, we now see this dynamic starting to evolve in terms of the demands by U.S. Congress to tie further funding for the Iraqi War to “benchmarks of progress” by Iraqis to defending themselves. But what is really ironic is an Associated Press article in Friday’s papers, stating that “More than half the members of Iraq’s parliament signed proposed legislation Thursday demanding a timetable for the withdrawal of U.S.-led troops and a freeze on the number of foreign forces in the nation.” Now let me see if I have this right: the majority of U.S. Congress members want a timetable to withdraw U.S. troops from Iraq. And the majority of members of Iraqi’s parliament want a timetable for the withdrawal of U.S. troops from Iraq. So… what’s the problem? And then this article in Wednesday’s Wall Street Journal reports: “Meanwhile, the Army notified 35,000 soldiers they could be called up.” So the “troop surge” has grown from the original call for 20,000 more troops late last year, to 21,000 earlier this year, to 21,5000 a few weeks after that, to possibly 35,000 more now.

Is this a sign of desperation? It is a sign of transiting Saturn in opposition to Neptune, and a commander in chief who’s progressed Mars (combat) is moving towards his natal Jupiter (expansion). I’m not saying the troop surge isn’t a good idea (I don’t know). I am just saying that things aren’t proceeding according to what was projected before. It is another example of another error in information - intentional or unintentional, I do not know. And with Saturn in opposition to Neptune, we may never know the truth until it’s over, for this is an aspect of doing much behind the scenes. In the meantime, the Congressional investigations continue to mount, also consistent with this aspect. So what is this aspect good for? Distinguishing between reality and fantasy, between what is possible versus what is an illusion. It requires honest and accurate appraisal of the situation. Otherwise, disillusionment leads to disappointment, both in terms of geopolitical affairs and financial markets.