Tag Archives: FOMC

Stock Market Trading at the Summer Solstice

Yesterday’s market action just after the announcement from the Federal Open Market Committee was a clear reminder not only of the power of the Fed in swinging market sentiment, but also of the power of the cardinal zodiac points.

It’s the 90-degree location that’s in play right now, at the start of the zodiac sign of Cancer.

This was one of W. D. Gann’s favorite spots to watch in his astro-trading research and market forecasting, and for very good reason.

As I’ve noted before, one of the things that made the timing of the announcement yesterday so noteworthy was the fact that transiting Mercury was conjunct Pluto in the Federal Reserve horoscope, which also happens to be at this key 90-degree zodiac location.

This kind of conjunction is not terribly rare in and of itself, of course– what was unusual was the fact that it came during an FOMC meeting.

The result, of course, was an extremely sharp response from the markets, as I noted in my post after yesterday’s market close.

In a kind of knee-jerk overreaction to the announcement, the equities indices rallied sharply during the final hours of trading, but we’re expecting some solid price consolidation and a possible pull-back during today’s trading, as the transiting Mars activation of the Fed’s Moon/Saturn midpoint comes into play more strongly.

The next time we get an activation of this key zodiac point is just ahead of us– it’s the Summer Solstice coming up this Saturday.

While the market impact is a little hard to forecast because this is a weekend event and because the net effect may be reduced somewhat by Mercury’s current retrograde condition, the Summer Solstice itself has a solid track record for triggering trend reversals in the markets– it happens about 3 out of 4 times.

S&P Summer Solstice
The Summer Solstice helps trigger trend reversals in the S&P 500 about 74% of the time.

We’ve been back-testing the last 53 times this event has happened, and have found that the Summer Solstice has previously triggered a trend reversal down roughly 44% of the time, a trend reversal up 30% of the time, and no trend reversal at all 26% of the time.

Since the stock market remains in a disturbingly persistent uptrend right now, it looks like the odds favor a move to the downside following the June 21 Summer Solstice this year.

We won’t know how it works out until Monday, of course, but right now our expectation is that we’ll see declining prices in equities as the new trading week gets underway.

Mercury & Pluto at the Fed Announcement: Big Action for Stocks, the VIX, and the Dollar, Too!

In spite of the fact that one of our readers has dubbed the comments posted here on the Fed’s announcement today “the worst call out there”, it’s still interesting to see exactly what the markets actually did in the final hours of trading today– and to anticipate what the action in equities will look like tomorrow.

Throughout most of the trading day prior to the 2:00 p.m. announcement, stock prices were churning in a somewhat apprehensive market with a decidedly bearish bias.

But when the Fed announcement was released, it immediately became apparent that Mercury’s conjunction with the Fed Pluto was having exactly the kind of dramatic impact we had anticipated. The major market indices all rallied, breaking into positive territory and pushing to new heights by the end of the trading session.

Fed Indices Response
The S&P 500, the Dow Jones Industrial Average, and the NASDAQ Composite all rose after the Federal Reserve’s Open Market Committee made its announcement on June 18, 2014.

The S&P not only rallied, it also managed to hit yet another all-time record high by the time the closing bell on Wall Street rang. Note as well that both Gold and the Euro showed significant strength for the day.

It was also worth watching the VIX during the trading session. This measure of market volatility took a sharp plunge right after the Fed’s announcement, confirming the old “buy the rumor, sell the fact” adage– once the facts were known about the Fed’s intentions, a lot of the uncertainty that had roiled the market action earlier in the day began to fade away.

Fed Announcement VIX Response
The VIX reaction to the Fed’s announcement was quite dramatic.

In looking at the VIX chart, it’s worth observing that the index had already risen to the higher levels we had forecast last week as a potential response to Mercury’s retrograde passage over the cardinal axis. We’re still looking for more action in this Fear Index during the coming weeks, with a return to higher levels of volatility as we approach the July 4 Independence Day holiday.

This dramatic action in the VIX was further confirmation of the power of the Mercury/Pluto combination that made the timing for this event so noteworthy.

But even though the Mercury/Pluto action bore out the forecast, I had also looked at the Mars transit to the Fed chart and had assumed that the market’s reaction to the announcement would be “less than enthusiastic,” based largely on the activation of the Moon/Saturn midpoint in the Fed horoscope.

Things didn’t turn out that way.

We certainly didn’t see a negative reaction in equities during the remainder of the trading day. But Mars moves more slowly than Mercury, so the impact of its transit is likely to carry on a little longer. That’s one of the reasons why we’re still anticipating a pull-back in stock prices before the end of the week– and why our Gold-Plus Elite members at FinancialCyclesWeekly.com are planning to add to the short positions in our Model Portfolio before the market closes on Friday..

Remember, too, that the influence of the Federal Reserve goes far beyond just the price of stocks. The Fed’s announcements have a big impact on currencies, of course, which is why it was particularly interesting to see what happened to the dollar this afternoon:

Dollar Reacts to Fed
The U.S. Dollar Index had been trending lower before the Fed’s announcement on Wednesday afternoon, but as soon as the official word was released the Greenback started going through wild swings. Volatility remained high for the rest of the day, with the dollar pushing sharply lower.

 

How Will The Fed Impact Stock Market Trading?

In many respects the Federal Reserve has lost much of the mystery that made it the subject of seemingly endless attention and speculation by active traders and market pundits. The minutes of the Federal Open Market Committee meetings are made public, and Fed officials are often in the public eye, sharing their comments and perspectives on the economy and other matters.

But when we look at the astrological charts for the Fed, we open up the realm of mystery once again.

The current transits to the horoscope for the Federal Reserve, especially at a time like now when there’s an FOMC meeting going on, can tell us a lot about what’s going on behind the scenes.

Federal Reserve astrology - Mercury at the FOMC announcement on 18 June 2014
When we examine Federal Reserve astrology, we can learn a lot about important dates and events in the life of the central bank. The red pointer here indicates the position of transiting Mercury at the time of the announcement following the Federal Open Market Committee meeting on June 18, 2014.

For example, we can look at the transits for the announcement following the meeting of the Federal Open Market Committee on June 18, 2014 and immediately see the importance of the event, including its hidden significance.

Transiting Mercury conjoins Pluto in the Fed chart, activating the cardinal axis of the zodiac as it triggers the Fed Moon as well as the midpoints of Sun/Admetos, Mars/Chiron, and Kronos/Vulcanus. It’s thus clear that no matter what the Fed says in its announcement, there’s likely to be a powerful reaction.

Sometimes, of course, actions speak louder than words. That’s why it’s instructive to see the way that Mars, the planet of action, activates the chart for the Fed as well.

Federal Reserve Astrology - Mars at FOMC Meeting 18June2014
Federal Reserve astrology reveals even more when we examine other planetary pictures.The red pointer here shows the position of Mars at the time of the conclusion of the FOMC meeting on June 18, 2014. It activates significant midpoints in the Fed horoscope, including Moon/Saturn, Neptune/Midheaven, and Cupido/Poseidon.

The midpoints that get triggered here suggest that the responses to the Fed’s actions will be less than enthusiastic, so we could see some nervousness in the equities markets as a result.

We’ll have to wait and see what the complete reaction will be in stock market trading after the FOMC does its thing this week. But with the aid of the astro-trading advantage, we can get some insights that other traders lack!