Predictions & Forecasts

Mueller report says no Russia-Trump conspiracy as Jupiter enters Sagittarius

(24 March 2019) They don't call Jupiter the Great Benefic for nothing.  Just ask President Donald Trump.  Today, US Special Counsel Robert Mueller finally handed down his report into the possible conspiracy between the Russian government and Trump campaign during the 2016 election.  Mueller found that there was no evidence for a conspiracy although he did not exonerate Trump for possible obstruction of justice charges.  While the full details of the report are not yet known, the initial impact has been positive for Trump and his beleaguered administration.

While I still expect the other shoe to drop for the Trump administration later this year, I was not surprised by this finding.  Trump's horoscope is looking pretty good these days, mostly due to the favourable placement of transiting Jupiter.  Jupiter (29 Scorpio) is slowing down now ahead of its retrograde station on April 10.  It is in close conjunction with his Moon (28 Scorpio) and also activates his Sun (29 Taurus) by opposition.  So this Jupiter transit was doubly positive for Trump since it aligned with both the Moon and Sun.   Read more...


Markets await Fed decision tomorrow

(19 March 2019) The Federal Reserve meets tomorrow to issue its latest policy pronouncements on the state of the US economy.  Financial markets are not anticipating any changes in interest rates but Chair Jay Powell's language will be watched carefully as usual.  Since the Fed suddenly reversed itself in early January to a more dovish stance (i.e. no more hikes), stock markets have risen sharply as the low current interest rate environment can keep the debt-driven expansion afloat a while longer. 

While the continued low rates are good news for the markets, the economic data is starting to show signs of a slowdown.  A recession in the US is looking increasingly possible within the next 6-12 months.  Investors now have to weigh the relative benefit of the Fed's cheap money with the likelihood of lower corporate earnings.   Read more...



To Brexit or not to Brexit, that is the question

(12 March 2019) The UK edged one step closer to the precipice today as Parliament voted down a second Brexit proposal by Prime Minister Theresa May.  It was a crushing defeat for Ms. May after apparently negotiating better terms with her EU counterpart in Brussels.  The UK Parliament is due to vote on a no-deal Brexit tomorrow (Wednesday) which is widely expected to be defeated.  It will then vote for an extension of Article 50 on Thursday to ask Brussels for a delay past the March 29th deadline to leave the EU.  If the Thursday vote passes, then anything is possible, including a fresh elections, a second referendum and maybe no Brexit at all. 

It's a chaotic situation with no easy solutions.  To be honest, I have no idea what's going happen.  When there is more than two possible outcomes to a situation, it is more difficult to make an astrological prediction. Typically, good transits point to a constructive resolution while bad transits coincide with tension, conflict and an ongoing state of frustration. But here we have at least four possible outcomes, each with its own pros and cons: no-deal Brexit, the postponement of Brexit (but only if the EU consents), fresh elections, or a second referendum.   Read more...


Mercury turns retrograde on Canada's Justin Trudeau

(4 March 2019)  It may be a good time to get your ducks in a row -- just in case.  Mercury, the planetary mischief-maker, is due to turn retrograde tomorrow, Tuesday, March 5.   Our solar system's innermost planet will station at 5 degrees of sidereal Pisces, and then begin its three-week backwards journey through the night sky.  It returns to normal forward motion on March 28 after stationing at 22 degrees of Aquarius. 

Mercury retrograde cycles have a bad reputation for bringing all manner of confusion, frustration and disruption to our normal routines.  Perhaps nobody knows this better than Canadian Prime Minister Justin Trudeau.   Actually, Trudeau has been on the defensive for the past month or so as his government is at the center of a corruption scandal that threatens to bring down his whole administration.   The opposition parties and many media pundits have been calling for a formal inquiry, and his resignation.   Read more...


Jupiter (and Fed policy) drive gold price higher

(22 February 2019) With all the talk about the economy slowing down and the possibility of a recession, it may be a good time to reconsider gold.  As the Fed and other central banks shift their policies towards monetary easing, (i.e. lower interest rates, more asset purchases, holding higher amounts of debt on their balance sheets), gold may be in a better position to rise in value.  As central banks intervene by printing more money, the amount of debt increases.  This devalues the currency and thereby increases the risk of inflation.  Enter gold, as the safe haven and traditional store of value which acts as a hedge against inflation and currency debasement.

Gold has steadily risen over the past six months from a low of $1167 last August to a high this week of $1350.  Gold fell sharply on Thursday to $1327, however, but remains above its key support level of $1300.  Can gold continue to move higher or is it destined to slip back into its previous trading range?   Read more...


Markets tread water ahead of possible second US shutdown

(11 February 2019) The dysfunction of the US government is again on display this week with the approach of another shutdown deadline.  As before, the sticking point is funding for Trump's border wall with Mexico.  With the current three-week emergency funding measure winding down, talks have broken off between an increasingly defensive GOP and a more emboldened Democratic Party.  The deadline for a deal is Friday the 15th at midnight.

A quick look at President Trump's horoscope shows that his position is unlikely to improve this week.  Mars is conjunct Uranus in the 9th house indicating trouble and sudden conflict involving legal bodies (Congress!) and perhaps foreign countries and their governments.  Moreover, the conjunction occurs at 5-6 degrees of Aries which aligns exactly with his Ascendant at 6 Leo.  The planets indicate this is a moment of very intense conflict.  By itself, it does not reveal if he is more likely to win or lose this battle. 

But other planetary positions look more difficult.   Read more...


After shutdown defeat, Trump prepares for SOTU on Feb 5

(29 January 2019) The chaotic presidency of Donald Trump has now entered its third, and possibly final, year.  Last week, the US government shutdown was finally resolved after Trump caved and agreed to a temporary three-week stopgap spending bill.  It's anyone's guess what happens on February 15 when the bill expires as Trump has vowed to build his controversial border wall one way or another.  Another shutdown is possible, or Trump may declare a state of emergency to override the Democrats' opposition. 

Before that, Trump will give his State of the Union address (SOTU) before Congress on Tuesday, February 5.  It promises to be a moment of high political theater as Trump confronts what is likely to be a hostile, Democrat-controlled House.  The planets suggest the SOTU will be a contentious affair as Mars will be prominent in the first degree of sidereal Aries.   Read more...


Powell blinks: markets rally after Fed Chair's dovish comments

 (15 January 2019) Financial markets are looking a bit more stable now after the Federal Reserve seemed to dial back its commitment to higher interest rates and quantitative tightening.  Stocks have rallied strongly following the dovish comments from Fed Chair Jay Powell which reduced the likelihood of more rate hikes in 2019.   This bullish investor reaction was another reminder how dependent the stock market is on these historically low interest rates and how captive the Fed is to the stock market.  

Because the stock market is so deeply intertwined with the US and global economy, any major decline will force the Fed's hand.  The "wealth effect" requires the Fed to support stock prices in order to improve sentiment and thereby encourage consumer spending.   After all, if consumers see the value of their 401k declining precipitously, they are less likely to spend their money.  This essentially broadens the mandate of the Federal Reserve to include inflation, employment and the stock market.  Read more...


Beware the bear: how 2019 may be a repeat of 1937

(7 January 2019) The New Year got off to a positive start for most global stocks as investors tried to put the unnerving 2018 decline behind them.  Friday saw a surge of more than 3% on US markets on the perfect storm of a strong US jobs report, an interest rate cut in China and above all a dovish statement from Fed Chair Jay Powell not to hike too quickly, if at all.   Markets are still fragile and there remains considerable uncertainty about what may lie ahead for this year.

My basic expectation is that stocks may well recover somewhat over the next two or three months but that the planetary alignments look very bearish for much of the year.  As I see it, 2019 is shaping up to be a negative year for most global stock markets as a bear market is likely.  Even if there is a significant recovery going into spring, it seems unlikely they will return to their previous highs.  Read more...


US government shutdown hammers markets

(25 December 2018) The US government shutdown is just the latest development to sideswipe the stock market.  The month of December has seen the Dow lose 4000 points as investors are re-evaluating their risk appetite against the background of an increasingly chaotic White House.   Markets fell in early December as hopes dimmed for a US-China trade deal and then selling accelerated last week after Fed Chair Jerome Powell issued an unexpectedly hawkish statement about rate hikes in 2019.  Then on Friday the US government shut down due to a disagreement over funding for the US-Mexico border wall, a key Trump election promise.  President Trump has now made a bad situation worse through his repeated criticisms of the Fed Chair Powell and his stated desire to fire him.  

All this chaos and uncertainty was too much for many investors as they rushed to the exits rather than waiting for a happy ending to the latest episode of The Trump Show.   Read more...


The Fed's Jay Powell: Santa or Scrooge?

(17 December 2018)  All eyes are on Federal Reserve Chair Jay Powell this week.  Given recent volatility in financial markets, this Wednesday's FOMC statement and press conference will be more carefully watched than usual.  Up to now, Powell had indicated a preference for raising rates in December and then several more times through 2019.  This path of "interest rate normalization" was intended to keep inflation under control to avoid overheating the strong US economy. 

But recent economic data have been more mixed and could force the Fed to rethink its approach.  The US housing sector is showing signs of slowing, and global growth is also looking weaker as China may be compelled to undertake yet another stimulus program.  And then there are the financial markets themselves. 

While it is not an explicit part of the Fed's mandate, it is clear that a falling stock market undermines the "wealth effect" which can thereby dampen investment and business activity.  Read more...


Markets plunge on arrest of Huawei CFO; Trump's endgame looms

(10 December 2018) One big reason for my interest in financial markets is because they offer a unique window on collective sentiment in the world.  We can read any number of media think pieces on the importance of this or that issue, but markets are an important weather vane for what people -- and their money -- are concerned with.  How much are investors worried about US-China trade?  Well, look no further than last week's decline which arrived after it became clear that the so-called truce in tariffs had little substance, despite President Trump's assertions to the contrary.  The Dec 1 arrest of the Huawei CFO in Vancouver only made matters worse for financial markets, as it looked like a crude US power play designed to force China's hand in negotiations.  

The week unfolded more or less as forecast in this space last week as Monday's bullish Moon-Venus-Uranus alignment produced only one up day after which the market sold off hard falling by 5% in the US and a more modest 2% in India.  As I noted, the planetary alignments were quite bearish through most of the week and argued for some downside.  Read more...


Markets rise on US-China trade truce

(3 December 2018)  Stocks are poised to rally further on Monday after the weekend agreement by the US and China to delay the imposition of any possible further tariffs by 90 days.  This truce in the trade war is the latest piece of good news for financial markets after stocks bottomed out during Thanksgiving week.  Since then, investors have also cheered the Fed's more dovish comments indicative of fewer interest rate hikes for 2019.  A more gradual return to normal interest rates would be welcome by heavily indebted companies and consumers alike. 

This strong rebound is not too surprising from our astrological vantage point.  To be sure, I had expected some downside at some point during the Mercury retrograde cycle (Nov 16 - Dec 6) and that has come to pass given the final dip we saw into the US holiday week on Nov 23.  But Mercury retrograde cycles are usually not all bearish and so we have seen a rebound last week and this week has also started on a bullish foot.  Read more...


Stocks vulnerable as Mercury retrograde approaches

 (12 November 2018) It's that time again.  Mercury is due to station retrograde later this week on Friday, November 16.  Even among the non-astrologically-inclined, most people have heard of Mercury retrograde.  They know it connotes something bad or unexpected, and that things are more likely to go haywire during the three-week period when it moves backwards in the night sky.  As the mythological winged messenger, Mercury symbolizes communication, commerce, transportation and rational thought, among other things. 

When Mercury is moving in normal direct motion, it is believed that there is a greater likelihood for things to work out as planned.  But every four months or so, it stations retrograde (Rx) and appears to move backwards across 15-18 degrees of arc.  This departure from its normal motion conjures up images of hassles, delays, technical breakdowns, computer viruses and the like.  The most famous Mercury Rx station in recent times was election night in the US in November 2000 which produced the unprecedented Bush-Gore stalemate.  The election outcome was undecided until it was settled finally in the Supreme Court a month later.  Read more...


Stocks rebound ahead of US midterm elections

(6 November 2018) Stocks have rebounded since bottoming in last week on hopes that a trade deal with China may happen sooner rather than later.  The Dow is back over 25,000 while India's Sensex is now trading near 35,000 ahead of the Diwali holiday break.  The rebound was more or less expected given the fairly positive planetary alignments in recent days involving Jupiter and Mercury.  This week has also leaned bullish on the Venus-Moon-Uranus alignment. 

However, the US midterm elections take place today and could theoretically upset the market's temporary calm. While I think the Democrats are very likely to win the House, I suspect the market has discounted that outcome already.  Therefore, I would not necessarily expect a big reaction in the stock market on Wednesday. 

The New Moon at 21 Libra could be a bit bearish since it opposes the Saturn in the NASDAQ chart.  Read more...


Midterm elections: the beginning of the end of Trump?

(4 November 2018) So is this the end of the beginning or the beginning of the end?  The United States goes to the polls on Tuesday, November 6 for its midterm elections for the House of Representatives and Senate.  The elections are widely seen as a referendum on the controversial presidency of Donald Trump who has taken the US sharply to the right in his first two years in office.  Polls show the Democrats are likely to win control of the House of Representatives but will fall short of winning back the Senate.

If the GOP holds on to the House and Senate, then it would greatly strengthen Trump's hand and likely give him the momentum to extend his mandate towards more authoritarian policies in his re-making of America into a post-liberal society.  If the GOP loses even just the House, then the Democrats are likely to prevent him from getting much done for the second half of his term.  They will also launch more investigations into his affairs and will likely try to impeach him.   Read more...


Stocks bounce after bad week; Q3 earnings reports in focus

(29 October 2018) Stocks sold off sharply last week on renewed fears that Trump's trade war will reduce revenues and profits of many large US corporations.  The Dow lost 3% on the week and closed below 25,000 for the first time since July.  Indian stocks joined the global sell-off as the Sensex fell almost 1000 points and came close to testing its March low. 

Stocks have rebounded here on Monday in Europe and the US on the proverbial oversold bounce.  Besides bargain hunting, investors may also be looking forward to corporate earnings as some big names will report Q3 earnings this week.  Facebook reports on Tuesday, Apple reports on Thursday, and Exxon Mobil on Friday.  While it is still possible the news could disappoint the market, at least it changes the subject for a few days away from the gloom that has been hanging over the US market during October.    Read more...


 Stocks fall again as Trump's trade war begins to bite

(23 October 2018) Stocks are falling again today as the market begins to digest the fallout of Trump's trade war.  There is growing concern that China's economy is in trouble while bellwether Caterpillar disappointed investors with their forward earnings guidance today.  Rising costs and tariffs were specifically mentioned as the reason for the expected sales slowdown.  The Dow has fallen 500 points so far, and is again trading under 25,000 for the first time since early July.  This is all bad news for Trump, of course, as the midterm elections are just two weeks away.

The negative performance is not surprising given this week's planetary alignments.  Not only is Venus still retrograde (and will remain so until November 16), but it is in close alignment with Saturn.  This introduces an elevated risk of declines.  In addition, Mercury forms a rough 45 degree alignment with Saturn which may add to the overall cautious mood in global markets so far this week.  The Sun is also in a volatile alignment with Uranus and the Lunar Nodes.  It is not a bullish picture to be sure.   Read more...


Stocks plunge with Venus Rx; Trump blames "loco" Fed

(15 October 2018) Stocks tumbled across the world last week on worries that rising interest rates would undermine economic growth.  US stocks fell 5% on the week as the Dow and the S&P 500 traded below the all-important 200-day moving average.  President Donald Trump saw fit to lay blame for the decline on the Fed which he described as "loco" (i.e. crazy) for raising rates too quickly.  One thing's for sure in this White House is that when something bad happens, it's never Trump's fault.  This is doubly true now that Trump and the GOP are facing the likelihood of loss of the House and possibly even the Senate in the upcoming midterm elections.  For the pro-business Trump, he desperately needs stock prices to be as high as possible in order to justify his claim that his policies are working and America is once again "winning".

The decline in the stocks market is in keeping with our expectations of the bearish effect of the Venus retrograde cycle.   Read more...


Venus turns Rx: stocks fall as interest rates rise

(8 October 2018) It's a classic case of good news and bad news.  The good news is that US economy is getting stronger with historically low unemployment rates and 4% GDP growth.  But the bad news is that this is creating inflation pressure so that interest rates must rise.  The Federal Reserve raised rates again at its September 26th meeting and the bond market has seen yields spike last week as the benchmark 10-year rate pushed above its previous high to close at 3.22%.  This means that the cost of borrowing is going up and that could eventually undermine the economy as debt servicing costs rise.

The spike in yields proved too much for the stock market as US stocks took a significant hit last week.  It seems that US markets are finally catching up with the rest of the world.  Asian and European markets have been falling since September -- or in some cases like China, since January -- as rising US rates are creating havoc for highly leveraged foreign corporations.  Indian stocks, for example, have tumbled more than 10% since their late August top as the BSE-Sensex is now trading below 35,000.   Read more...








 


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