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.
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.