Weekly column: Federal Reserve's interest rate surprise and auto workers' strikes

Review and preview

On Wednesday, Federal Reserve officials surprised markets by signaling interest rates won’t fall as much as previously planned. The tweak might be more important than it looks. In their projections and commentary, some officials hint that rates might be higher not just for longer, but forever. – Greg Ip, “Higher Rates Not Just for Longer – Maybe Forever,” Wall Street Journal, September 22, 2023.

The United Auto Workers is expanding strikes to 38 parts and distribution locations across 20 states, targeting General Motors and Stellantis, UAW President Shawn Fain said Friday morning. The union will not initiate additional strikes at Ford Motor, as the company has proven it’s “serious about reaching a deal,” Fain said. – Michael Wayland, “UAW Targets 38 Facilities at GM and Stellantis for Expanded Strikes,” www.cnbc.com, September 22, 2023.

The euphoria of the Sun/Neptune opposition on Tuesday, September 19, wore off immediately after the Fed announced on September 20 that it would not raise interest rates at this time. With Jupiter in Taurus (May 2023-May 2024), this is what we expected. With Taurus (steady), rate increases (Jupiter) were likely to be contained and steady. The only exception we foresaw would have been when Venus, ruler of Taurus, was retrograde (July 22-September 3). There was a brief .25% increase during that time.

Initially following this week’s rate announcement, stocks rose around the world. But by the end of the day, the “glamour” wore off as Fed Chair Powell reiterated his stance that rates would not likely decline either. In fact, he suggested they would remain high for an indefinite time. No surprise there to us, as we think interest rates are in a long-term upward trend until the next Saturn/Pluto conjunction in the middle of this century, as described in the last three annual Forecasts Books. But clearly, the market did not like that outlook on Wednesday. By the end of the week, most global stock indices had fallen, with several dropping to their lowest levels since the bank runs of mid-March, including the DJIA. This, combined with the auto (and other labor) strikes, warns of a possible stock market downturn, perhaps the sharpest decline for 2023 (see below).

In other markets, Crude Oil made another new high last week under the Sun/Neptune opposition of September 19, also as expected. Now, we will see whether this is just a modest major cycle correction or a more severe multi-week primary correction. The rise in Crude Oil is one reason for the stock market sell-off. It means inflation is still not under control, despite the fact that Powell dismissed it as an unreliable (erratic, unstable) indicator for inflation. As with all things Neptunian, this may be more wishful thinking than reality. Bitcoin had a positive week, rallying to a new three-week high following a possible primary cycle low on September 11. But here, too, the high of the week was right on Tuesday, September 19, with the Sun/Neptune opposition. Silver rallied smartly into Friday, but Gold is still treading water between its high and low of the past month as Mars readies for its ingress into Scorpio on October 12.

Short-term geocosmics and longer-term thoughts

Pre-eminence always entails obligations. You have to act the part. You have to present yourself with dignity. You have to comport yourself with class. For some time—let’s say since the turn of this century—we’ve been at a point in our power where we still love to insist on the pre-eminence—USA! USA!—while increasingly ignoring the responsibilities… We want to be respected but no longer think we need to be respectable. – Peggy Noonan, “The Senator’s Shorts and America’s Decline,” Wall Street Journal, September 23, 2023.

Let’s get right down to it. The Sun/Neptune opposition of September 19 and Venus/Jupiter square of September 17 did not lift equity markets to new cycle highs as expected. They were close to the highs of August 31-September 1 and could qualify as double top chart formations (bearish), especially as some indices (including DJIA) are now breaking below the August 18-25 primary cycle lows (bearish). We didn’t expect that – yet. Typically, even in bear markets, the rallies will last 2-5 weeks after the low. The NASDAQ and the S&P high was two weeks after their lows of August 18. But the DJIA high was only one week after its low of August 25. Hence, we (I) thought it had higher to go, based on the DJIA. But sometimes this doesn’t happen (maybe less than 5% of the time). But we (I) did anticipate in our reports that when this newer primary cycle tops out, it could lead to the steepest decline of the year as we head into the Sun/Mars conjunction of November 18. Within an orb of 8° (about six weeks), this aspect has a high correlation to the start or end of 8% or greater declines in global stock indices, according to our research conducted a few years ago. So, the bigger picture is intact, and the astrology (or geocosmics) didn’t miss the smaller picture, as some Twitter (now ‘X’) critics like to point out.

Now, I don’t mind criticism when it is constructive or followed by mature, constructive suggestions. I think that is healthy and can lead to lively and educational debate. But what is annoying is when a critic feels entitled to pass judgement that “astrology doesn’t work” because the astrologer (me, in this case) made a judgement call that didn’t work exactly as expected in a particular case.  I want to make it clear: astrology worked – and continues to work – just fine. In fact (well, in my opinion, based on 45 years of trading experience and market analysis), nothing works better as a market timing tool than astrology. As a point of reference, I went back and looked at the critical reversal dates given for stock indices in Forecast 2023. These were calculated in November 2022, well before the year began. All but one of the 9 dates given for reversals have coincided with trading cycle reversals within 3 days, seven within two days or less, and six either exactly on the date or within one day, including the high (in NASDAQ) and low of the year. How does that happen if “astrology doesn’t work?”

As one ‘X’ follower tweeted, astrology is difficult to use as an “actionable” trading tool because it is “nuanced.” That is true. But what market indicator is not “nuanced?” Astrology is not a “stand-alone” system for successful trading. It is mostly used as a “market timing” indicator of a potential/probable reversal, which by itself has value but by itself cannot assure success in trading. It requires being used in combination with other market analysis tools. The same can be said about astrology being used as a tool to help other people. Just making “predictions” based on a chart doesn’t actually help another person in many cases. Used that way, astrology is either just information or entertainment. In fact, it can be harmful when not used with adequate consulting or counseling skills. Professional astrologers know this. Professional traders know this. But those who have not really studied either subject don’t know this. Yet they often think they know that “astrology doesn’t work” only “because it shouldn’t work.” That’s all they have. So, they will marginalize those who have or know something that they do not have or know.

The moral of this week’s column: The more you know, the more “nuanced” you are likely to become. You will never be perfect, and your decisions will never be 100% correct all of the time. You will make decisions that do not work out as you expect. It’s life. But the risks you take can always be viewed as investments in learning and facilitating your own personal evolution. And in the process, you will become a person of interest to others. Do not be afraid to take risks, for you will miss out on opportunities. But be disciplined and measure your risks and opportunities intelligently.