Weekly Column: It's time for crude oil

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Consumer prices for May accelerated at their fastest pace in nearly 13 years as inflation pressures continued to build in the U.S. economy. The consumer price index, which represents a basket including food, energy, groceries, housing costs and sales across a spectrum of goods, rose 5% from a year earlier. Economists surveyed by Dow Jones had been expecting a gain of 4.7%. The reading represented the biggest CPI gain since the 5.3% increase in August 2008, just before the financial crisis sent the U.S. spiraling into the worst recession since the Great Depression. – Jeff Cox, “Consumer Prices Jump 5% in May, Fastest Pace Since the Summer of 2008,” www.cnbc.com, June 10, 2021.

The Fed announced a new policy doctrine almost a year ago (that) it would no longer consider lags when making monetary policy, forsaking the policy of “pre-emption.” (The) Fed believe the party is just getting started and won’t remove the punchbowl until the fun is in full swing and the neighbors know it. The Fed’s new doctrine is a catalyst for heightened concern… The resulting U.S. Dollar weakness poses a host of dangers, including inflation risks… The scale of government spending and scope of government activity are unprecedented… The Fed should change its policy regime. It should not tolerate Fed-financed fiscal expansion. – Kevin Warsh (former member of the Federal Reserve Board), “The Fed’s Risky Fill-the- Punch-Bowl-Strategy,” Wall Street Journal, June 8, 2021.

We are right in the middle of Mercury retrograde and the second (of three) passage of the powerful Saturn/Uranus waning square, arguably the dominant and most important geocosmic event of 2021. World equity markets continue to exhibit cases of intermarket bearish divergence, which is typical of Mercury retrograde.

However, the price action has not been particularly volatile as financial astrologers (like us) would expect under a Saturn/Uranus square though it has been in Gold and Silver. And other markets have made new cycle highs, like T-Notes, Crude Oil, and the S&P and a few other world stock indices (Netherlands AEX, German DAX, Zurich SMI, Australia ASX, India’s NIFTY, and Brazil’s Bovespa).  But counter-trend moves have not been severe (yet), which is more like the Trickster’s footprints than that of Uranus. The former gets volatile when everyone thinks the waters are calm. But then it often slows the pace of price movement when everyone expects fireworks. Everyone (well, financial astrologers, anyway) expected more fireworks, especially with last week’s solar eclipse in the Trickster’s ruling sign of Gemini, where it currently resides with several other planets square Neptune in Pisces (another mutable sign) in what we call “Mutable Madness.” The “madness” seems more prevalent in government and central bank actions (or lack thereof) in the face of a growing call for more action. Perhaps this “tightening” in market prices is a sign of the market coiling, like a cobra stealthily getting ready to strike.

In other markets, Crude Oil rallied to 71.29, its highest level since October 2018. The Euro currency fell to its lowest mark in five weeks as the U.S. Dollar rallied following last week’s lower than expected jobs reports. Not meeting expectations was the very cause the Fed needed to retain its extremely accommodative monetary policy, despite pressure from many commentators forecasting that they must raise rates in the face of rapidly rising inflation. But, just as this column forecasted, Jupiter entering Pisces, May 13-July 28, would not likely see rates rise because that transit would form a trine and sextile to the Fed’s natal Sun/Pluto opposition. When Jupiter activates the Fed’s founding chart (December 23, 1913), monetary policy eases, not tightens. And since the Fed can’t ease much more, they would decide to keep short-term rates steady at near zero.

Short-term geocosmics and longer-term thoughts

We keep hearing that the corporate tax code is riddled with “loopholes” and that large corporations are tax cheats  for using them and not paying their “fair share.” Is it true? No, most large corporations  pay the amount in taxes they do because Congress expressly wrote the tax code to allow them to pay that amount… They (tax bills) were instituted (by Congress) to accomplish a goal, not because of some nefarious plot by Big Business…They (Congress) write exceptions into the tax code, then blame Big Business for them. Bill Cassidy and Jeff Hoopes, “ Lawmakers’ Hypocrisy in Blasting ‘Loopholes’,” Wall Street Journal, June 9, 2021.

Leaking (the tax returns of individuals) is a crime, since under federal law tax returns are confidential. Someone at the IRS – or someone who hacked the IRS – leaked the documents to influence the debate in Congress. This is the same IRS that (the Administration now wants) to infuse with $80 billion more to chase a fanciful amount of uncollected taxes. As part of this effort, Mr. Biden wants the IRS to collect “gross inflows and outflows on all businesses and personal accounts from financial institutions.” Why? So the information can be leaked to ProPublica? – Wall Street Journal Opinion Page, “Return of the IRS Scandal,” June 9, 2021. 

Mercury the Trickster is now not only retrograde in Gemini, but is forming a square aspect to another trickster, Neptune in Pisces. The combination has the symbology of utter and mass confusion, uncertainty, complacency, wishful thinking, and possibly intentional misdirection (“leaking”). This is not the time to believe what you see, hear, or read. It is the time to maintain a healthy skepticism regarding any proclamation or promise. Promises can be easily broken now. Truth becomes the stuff of alternate realities and subject to reinterpretation.

On Sunday, June 13, this peculiar state of affairs continues as the Sun will also square Neptune. In the study of financial market timing, this just happens to be one of the most powerful and consistent geocosmic correlations to primary or greater cycles within an orb of 11 trading days (83% rate of frequency). The next day, June 14, Saturn will make the ;passage of its second waning square to Uranus, which has an extremely high 48% historical rate of frequency to 50-week or greater cycles in U.S. stocks, and a 70% correlation to primary cycles, within an orb of 10 trading days. So far there is no indication of a primary cycle crest in the DJIA or NASDAQ, but there is now in the S&P with Friday’s new all-time high. As long as the other two indices don’t make new all-time highs, this will become a case of intermarket bearish divergence within the critical June 10-25 period.

After Saturn starts to separate from its square to Uranus, another important geocosmic time band looms ahead. Jupiter and Neptune, the key components of a collective “irrational exuberance” behavior, both turn retrograde on June 20 and 25, respectively. And if that is not enough, Mercury will turn from retrograde to direct right in the middle, on June 22. On its own, that would suggest another period of rising equity prices. But with Mercury still strong as it makes its station, we cannot assume the markets will act normally. Support, resistance, and the real trend ahead may still be illusory. This is one of the reasons why we do not give strong position trading recommendations during Mercury retrograde. It is a period that favors very aggressive and nimble traders, but not those who think they know the trend-to-be. The Trickster can be even more difficult now that he is in Gemini and part of the Mutable Madness, in square to Neptune in Pisces.

So what is the period favorable for, and what markets are most prone to stumble? It is favorable for writing poetry, music, dance, gardening, and for enjoying the infatuating sensation of falling in love (but remember it is likely more of an illusion than real). It may be exceptional for a spiritual retreat and psychological renewal. It is a time to exhibit empathy, gentleness, and willingness to help others in need (as long as they are not “playing” you).

In financial markets, it highlights Crude Oil. As Crude Oil is rallying to new multi-year highs, it may be wise to capture some profits if you are long, and possibly probe the short side if you feel brave. But more than likely, this will be a period in which the U.S. energy policy comes under scrutiny. “Why is the nation giving up its energy independence?” is a question that reporters might seriously begin to ask the administration in the next two weeks. If they do, listen carefully. But be careful of believing anything you read, hear, or see.

And always remember: Under Neptune, “buy the rumor and sell the fact.” Furthermore, under Mercury retrograde, make sure you have the other party repeat back what you think you just said. You may think you told your broker to “buy,” but the broker heard “sell.” You may think your date said or implied “yes” but maybe he/she meant “no.” Sometimes, with so much “Mutable Madness” in the cosmos, it is hard to figure out which double message is correct. So don’t assume. Say what you mean, mean what you say, and be totally honest with others. Your reputation may be on the line, so ask for clarity from others if you are uncertain of their messaging. And then enjoy the dance.