NOTE: U.S. markets are closed Monday for the Memorial Day Holiday.
REVIEW AND PREVIEW
Last week marked the Dow’s first eight-week losing streak since 1923, while the S&P 500 capped a seven-week losing streak, its worst since 2001. – Samantha Subin, “Stock Futures Rise After Dow falls for 8th Straight Week in Relentless Sell-off,” www.cnbc.com, May 22, 2022.
A report showing inflation slowing a bit helped give stocks a boost on Friday. The core personal consumption expenditures price index rose 4.9% in April, down from the 5.2% pace seen the previous month. This particular report is watched closely by the Federal Reserve when setting policy. – Tanaya Macheel and Hannah Miao, “Stocks Rise on Slowing Inflation Report, Dow to Snap 8-Week Losing Streak,” www.cnbc.com, May 27, 2022.
The midpoint of Mercury retrograde on Sunday, May 22, proved once again to be an important market timing signature.
After plummeting to its yearly low of 30,635 one week ago, on Friday, May 22, the DJIA reversed and started a 2500+ point rally, its biggest (and longest) rally since the primary cycle crest of 35,492 on April 21. It was classical Trickster behavior as the vast majority of investors, analysts, and the American public were convinced one week ago (and many still are) that a further and more serious crash was underway. Additionally, the previous week marked the longest losing streak for the DJIA in nearly 100 years.
Technical indicators and chart patterns were as bearish as the sentiment of fundamentals observed by investors. After all, interest rates are rising and are still expected to rise for the next several months. Inflation is at its highest level in 40 years. Home sales are stalling due to the spike in mortgage rates. People are postponing or cancelling their summer vacation plans due to the high cost of gasoline and air travel. The number of Americans who believe the economy is headed in the right direction is down to only 20%. The mood of the people hasn’t been great.
But the combination of Mercury retrograde (the Trickster) coinciding with Mars and Jupiter moving into Aries and forming a semi-square to Uranus, has “fired up” financial markets. Aggressive and speculative Mars, seeking action, is approaching “big dog “Jupiter this weekend, May 29. The Trickster’s midpoint reversed the markets while the transit of Mars and Jupiter in the fire sigh of Aries is coinciding with the large rally and a burst of new enthusiasm for risk. These are very useful leading indicators in the toolbox of market timers.
The largely unappreciated midpoint of Mercury retrograde worked again as a leading indicator, at least in this short-term, which is the time horizon of most traders. It nailed the low and reversal of May 20. Now the concern is whether that low of May 20, was also the end to the 23-month cycle trough, and the start of a new bull market, a topic we discuss in our weekly and monthly reports. But – hint – the recent MMA Spring Webinar on May 8 (click here) also discussed the possibility of another 10% decline in the DJIA by the end of May. The index was trading near 33,000 at the time and 34,000 as late as May 4. It dropped close to 10% on May 20. On Friday, May 27, the DJIA closed at 33,213, its highest level in 3 weeks.
Most global markets followed a similar pattern as the DJIA. That is, they rallied sharply into the end of last week from their multi-month and even yearly lows of the prior week on May 20. For most, the rallies represented their highest levels in the last 3-5 weeks.
In other markets, Gold and Silver had nice rallies all week, which were more associated with heliocentric Mercury transiting Sagittarius. Gold tested 1870 early last week, up sharply from its recent multi-month low of 1785 on May 16. Silver rallied to 22.47 on Friday, its highest price in three weeks. Crude Oil rallied to 115.30 on Friday, May 27, testing its 8-week high of 115.56 made on May 17. Bitcoin, however, was quiet, trading between a high of 30,693 last Monday and a low of 27,959 on Thursday, whereas Ethereum fell to 1710 on Friday, retesting its multi-month low of 1702 made on May 12. It appears the connection between the stock market and Bitcoin/Ethereum has broken. Stocks soared and cryptos snored.
SHORT-TERM GEOCOSMICS AND LONGER-TERM THOUGHTS
A recent survey done by the Associated Press-NORC Center for Public Research found that just 21% of adults believe the US is going in the right direction, down from 29% in April. Even Democrats are losing hope – with only 33% saying the US is headed in the right direction compared to 49% a month ago and 55% in March. – Callie Patterson, “Two in 10 Americans Say US Headed in the Right Direction,” New York Post, May 20, 2022.
The U.S. finds itself trapped in a set of economic circumstances it hasn’t experienced in 40 years. Navigating them successfully will require a degree of policymaking dexterity that has been notably absent in both the monetary and fiscal realms in recent years.– Gerard Baker, “Rescue From Recession Won’t Be So Easy This Time,” Wall Street Journal, May 24, 2022.
The restrictions of the COVID-19 pandemic may finally be lifted and people are free to travel again. However, this can also be a period of carelessness. With Jupiter and Neptune in Pisces, it can be both sides of the story: increased freedom to move about, but tendencies to be careless for which a price may have to be paid soon after. – “Forecast 2022 Book,” written September-October 2021, www.mmacycles.com>Shop>Books, or click here.
The major geocosmic signatures coming up in the next week include Mars conjunct Jupiter in Aries on May 29, followed by Mercury turning direct on June 3 and Saturn turning retrograde on June 4. The optimism and willingness to take risks associated with Mars and Jupiter conjoining a fire sign may get tempered later in the week when the serious-minded Mercury and Saturn both change directions just one day apart. Heliocentric Mercury ingressing into Capricorn on June 1 could also be a return to more caution as Mars separates from Jupiter.
Investors will likely be reminded that the Fed is still going to raise rates, the Russian effort to take control of Ukraine is still underway, and COVID-19 is still a health concern as restrictions are lifted and the contagion is still with us. We may enjoy the feeling of being free again and letting our guard down, but reality still demands the awareness that the virus doesn’t care and cases of hospitalization are rising again, especially for those unvaccinated. According to the CDC report of May 20, “… adults ages 18 years and older who were unvaccinated were about 5 times more likely to be hospitalized with COVID-19 than those who were up to date.” This is not an advertisement to get vaccinated, for that appears to have some risks for many as well. It is just a note to be careful of contracting the virus during these days of Mars/Jupiter in Aries, which can be a signature of carelessness.
On a longer-term view, it is interesting to note the 32-37-year cycles of Saturn/Pluto, which took place in January 2020, and its correlation to interest rates as observed in the last three editions of the annual Forecast Book. The conjunction has coincided with long-term cycles highs or lows (they alternate). The Saturn/Pluto conjunction of 1947 (two cycles ago) was a long-term low in rates. They were nearly 0% then too, as they were in 2020.
After the August 1947 conjunction, and as interest rates began to rise, the stock market fell to its 4-year cycle low in June 1949. It then began a very long bull market and economic expansion that lasted into 1966, despite rising interest rates. However, when interest rates rose quickly as a result of rising inflation, starting in 1973-1974, the stock market fell hard into its 36-year cycle low in December 1974, followed by 8 years of stagnation until the Fed finally broke the back of inflation in 1982.
The moral of this history? Stock markets can rise while interest rates rise if the rate of increase is moderate. Once the interest rate increases begin to accelerate rapidly, stocks get hammered. The Fed has indicated it will raise rates rapidly. But from 1947-1966, the rate of increase was steady and moderate and the stock market was mostly very bullish. The waxing phase of the Jupiter/Saturn cycle (2020-2030) also suggests economic growth through policies of moderation, not extremism (not too little, not too much).
We are in the early stages of a new 140-year Air Epoch, when the 20-year Jupiter/Saturn conjunctions take place in air signs. The first ten years is about building a new foundation, both economically and politically. The building of that foundation will require a leadership of moderation (Jupiter/Saturn). But it will also require an openness to allow inventions and a revolution in communications, to inspire a renaissance in societies everywhere. This is the primary characteristic of the long-term economic wave theory discovered by Nikolai Kondratiev, also called the “Kondratiev Cycle.”
President Joe Biden is probably right in one sense when he states that the economy is in a state of transition. It is probably from an economy that relies on fossil fuels today to one that will soon crossover to the use of alternate sources of energy to run the world. But in order for this transition to be successful, it needs to proceed at a gradual pace. That is the message of Jupiter and Saturn. In order to be accepted, policies must be moderate during this decade and the rate of change paced evenly. Not too much, not too fast. Not too little and not too slow. Otherwise, societies will rebel, and instead of intellectual and creative revolution, we will instead be apt to experience social disruption and upheavals.
The first two years of the Jupiter/Saturn cycle have historically been marked by wars, military outbreaks, and threats to both the economy and societies of the world. But they then give way to a period of expansion and growth. We are in the second year of the Jupiter/Saturn cycle now. The turmoil and disruptions that characterize this time may end August-November, when the last near-exact passage of the Saturn/Uranus waning square takes place, with Jupiter midway between (and forming a semi-square to both). The cosmic peak of this chaotic period is September 21-28, but a two-month orb of influence must be allowed to recognize what is happening. It’s going to be interesting. Stay tuned and be safe.
ANNOUNCEMENTS
NOTE 1: THE MAY ISSUE OF THE MMA+ Addendum to this MMA Monthly Cycles Report will be released this week (not last week as reported)! Written by Pouyan Zolfaharnia, this has become a very popular addition to the MMA Cycles Report (less technical, more visual, high-quality analysis and update on MMA Cycles Report markets). Readers love it! Pouyan will update our take on financial markets since the last issue of the MMA Cycles Report in a very visually attractive and easy-to-read format with excellent analysis. To order this month’s addendum coming out on May 31st, click here.
NOTE 2: TUNE INTO MMA’S NEW WEEKLY YouTube Channel on the geocosmic climate related to financial markets hosted by MMTA Educational Director Gianni di Poce. The video is recorded late Friday night and posted then or early Saturday, depending on the editing process. These 5-15 minute video presentations review the market activity of the past week and offer a preview of the geocosmic signatures in effect for the next week and beyond. You may subscribe to MMA’s YouTube Channel today at no cost and get announcements when each geocosmic market review is ready for viewing! To view this week’s show and discussion on the midpoint of Mercury retrograde related to financial markets, click here.
“Just a quick word to say your (Gianni’s) weekly video on YouTube is really a great complementary format to Ray’s letter. I find it interesting and masterfully delivered. Thanks to both of you for this!” M.K., Paris, France, Portfolio Manager.
NOTE 3: Ray Merriman was interviewed in Howe Street‘s “This Week in Money” show last week. You can hear the podcast at https://youtu.be/Ixnyp1EhwEg – it starts around the 42-minute mark.
EVENTS
AUGUST 25, 2022: 1:00 PM, Denver, CO, ISAR Conference, 4-Hour Pre-Conference Workshop by Raymond Merriman on “ASTROLOGY AND THE ART OF FINANCIAL MARKET TIMING: HOW TO FORECAST TRENDS AND MARKET REVERSALS.” Financial markets offer objective means to test astrological validity. The Moon changes signs every 2-3 days and is valuable for short-term trading. Planetary stations and aspects identify longer-term market reversals. Approximately 4-5 times/year, markets will form important highs or lows, which are the most favorable times to buy and sell for position traders. This course provides research studies showing the correlation of astrological factors to short-term and longer-term financial markets. The focus will be on stock markets, precious metals (Gold and Silver), and Bitcoin, and how to integrate astrology with cycle studies to attain optimal market timing skills. Visit https://isar2022.org/schedule/ for further information and register for a great event! For a video description of this workshop via interview between Ray Merriman and Conference Coordinator Laura Nalbandian, click this link https://youtu.be/kBxYZ_VpckA.
September 9-11, 2022: THE MMA TRADING AND INVESTMENT RETREAT, Troy, Michigan, at the Michigan State University Education Center. SAVE THE DATE! This special 3-day event will feature a long-term, intermediate-term, and short-term analysis of several financial markets, including the U.S. stock market, Gold, Bitcoin, Euro, T-Notes, and Crude Oil, plus others to be determined. It will also go into depth with the MMA trading plan– how to use the daily and weekly report data points – and how we assess each market and determine the trading strategy for each day based on MMA’s cycles analysis, geocosmic studies, solar/lunar studies, combined with chart patterns, price targets, and technical studies. This retreat is required for all graduating students of MMTA (the Merriman Market Timing Academy), some of whom will be presenting their own original research and analysis of markets to be discussed by instructors Raymond Merriman and Gianni di Poce. Attendance to non-students will be limited, and special rates will be available to subscribers of MMA reports (monthly, weekly, or daily). If you are a short-term trader, or an investor interested in the longer- and intermediate-term outlook, this is a special event you will not want to miss. It is an opportunity to not only learn about the future outlook for several financial markets, but also an opportunity to connect with those who understand and have mastered the MMA methodology of market analysis and market timing. This is a one-of-its-kind opportunity! Details for registration will be available on MMA’s website in about two weeks. Or, to get on the early release announcement, drop us an email at customerservice@mmacycles.com.
Disclaimer and statement of purpose: The purpose of this column is not to forecast the future movement of various financial markets. However, that is the purpose of the MMA (Merriman Market Analyst) subscription services. This column is not a subscription service. It is a free service, except in those cases where a fee may be assessed to cover the cost of translating this column from English into a non-English language. This weekly report is written with the intent to educate the reader on the relationship between astrological factors and collective human activities as they are happening. In this regard, this report will often cite what happened in various stock and financial markets throughout the world in the past week and discuss that movement in light of the geocosmic signatures that were in effect. It will then identify the geocosmic factors that will be in effect in the next week, or even month, or even years, and the author’s understanding of how these signatures may affect human activity in the times to come. The author (Merriman) will do this from the perspective of a cycles’ analyst looking at the military, political, economic, and even financial markets of the world. It is possible that some forecasts will be made based on these factors. However, the primary goal is to both educate and alert the reader as to the psychological climate we are in from an astrological perspective. The hope is that it will help the reader understand the psychological dynamics that underlie (or coincide with) the news events and their potential effect on financial markets.
No guarantee as to the accuracy of this report is being made here. Any decisions in financial markets are solely the responsibility of the reader, and neither the author nor the publishers of this column assume any responsibility whatsoever for anyone’s trading or investment decisions. Readers of this report should understand that commodity futures and options trading are considered high risk.