Weekly Column: Get out of jail

Review and preview 

Rising recession fears pushed U.S. stocks briefly into a bear market on Friday with the S&P 500′s decline from its all-time high in January reaching 20% at one point. A dramatic late-day reversal pushed the benchmark slightly into the green for the day at the closing bell. – Sarah Min and Fred Imbert, “Stocks Close Flat in Wild Session Friday that Saw S&P 500 Briefly Fall Into a Bear Market,” www.cnbc.com, May 20, 2022.

It was another wild and wacky week as the Trickster (Mercury retrograde), continued his penchant for teasing the bulls and then quickly pivoted back to serenading the bears, messing with their psyches too, along the way.

U.S stocks looked favorable into Tuesday, May 17, following their lows of May 12, one day after Mercury turned retrograde and Jupiter entered Aries. The DJIA had rallied from a low of  31,228 to a high of 32,689, a gain of 1400 points in those three trading days. But the next day it gave back 1164 points in one of the steepest daily declines in history. The plunge didn’t end until late Friday when it bottomed at 30,635, down over 2000 points from Tuesday’s high. But then a funny thing happened (it always does when the Trickster is the star). The DJIA (Dow Jones Industrial Average) rallied over 600 points in the last two hours to actually close up on the day. The S&P and NASDAQ also made new lows on Friday, and also rallied sharply during the final two hours. Which way is this crazed road runner running now? He’s leaving some clues as he skids to stop at the midpoint of his retrograde cycle this weekend.

Once again, the selloff to a new cycle and yearly lows happened only in America. The rest of the world’s stock indices remained above not only their lows of January-March, but also of May 10-12, the previous week, when Mercury turned retrograde and unleashed his alter ego (market instability).

So, here is the picture the Trickster has painted thus far. It has coincided with lows in most of the world’s stock indices within a day of turning retrograde, except in the U.S. There, he is making a new yearly low at the midpoint of his retrograde cycle. When a market doesn’t reverse near Mercury retrograde, it will usually continue its trend and then reverse at its midpoint. So, this Mercury retrograde cycle has a different set of rules for the U.S. than it does for the rest of the world. Maybe that’s because the U.S. is more messed up in economic turmoil than the rest of the world.

In Asia and the Pacific Rim, it is interesting to note that the China and Hong Kong indices are rising, and actually bottomed before the recent decline in other world indices. Australia, Japan, and India all pulled back into May 10-12, but held those lows and the lows of early this year during last week’s trading.

In Europe, each index held its lows of March 7-8. In addition, each held their secondary lows of May 9-13, except the Zurich SMI, which fell lower last week on May 19 for a case of intermarket bullish divergence to the other markets in the region.

In the U.S., each of the three major stock indices plummeted to new yearly lows on Friday, May 20.

In other markets, Bitcoin and Ethereum held above their washout lows of May 12, but so far have not exhibited any compelling bullish signs other than the proverbial “dead cat bounce.” Gold made a new multi-month low of 1785 on Monday, May 16, but was back up near 1850 by the latter part of last week. The U.S. Dollar came off its 19-year high of 105 made the prior week on May 13 but is still in a bull market. Crude Oil had quite a volatile week, trading between 103 and 115, but ending around 110. And Dr. Copper held its primary cycle low of 4.037 made on May 12 as Mercury turned retrograde, which is another positive sign because Copper often leads stocks. We will be talking more about Copper in the weeks ahead as we will soon add it to our monthly MMA Cycles Report. And by the way, we will continue listing solar/lunar values for stocks and metals after all, as subscribers requested that we continue this market timing feature. It is indeed valuable as a leading market indicator.

Short-term geocosmics and longer-term thoughts  

President Joe Biden’s approval rating dipped to the lowest point of his presidency in May, a new poll shows, with deepening pessimism emerging among members of his own Democratic Party. Only 39% of U.S. adults approve of Biden’s performance as president, according to the poll from The Associated Press-NORC Center for Public Research, dipping from already negative ratings a month earlier. Of particular concern for Biden ahead of the midterm elections, his approval among Democrats stands at 73%, a substantial drop since earlier in his presidency. In AP-NORC polls conducted in 2021, Biden’s approval rating among Democrats never dropped below 82%. – Nicholas Riccardi, “Biden’s Approval Dips to Lowest of Presidency: AP/NORC Poll,”  Associated Press (apnews.com), May 20, 2022.

The country’s politics are a mess. We have four political parties, not two: Trumpists and traditional conservatives on the Republican side, and moderates and progressives on the Democratic side. The forces at play are driving politics away from the center where solutions are usually found. (There is) cause for hope. Our democracy has always adapted and it can do so again. The power to make it survive and thrive remains in the hands of all of us who participate in, and benefit from, the great American experiment. – Gerald F. Seib, “After 3 Stormy Decades, There’s Still Hope,” Wall Street Journal, May 17, 2022. This was Gerald’s farewell address to WSJ readers after 29 years. I will miss his very balanced reporting.

For this week, we note several planets are changing signs. This is known as an ingress, and represents a shift in collective psychology where that planet is concerned. These are important, especially when it involves an outer planet, like Jupiter, which ingressed into Aries on May 11, just one day before all those markets made lows (except the U.S. stock market).

Now we have a slew of faster-moving bodies changing signs coming up, and they too are important for reasons to be discussed here. The Sun enters Gemini on May 21 for the next month, so the emphasis on world leadership will depend upon a leader’s ability to message properly, get the narrative correct and exhibit moments of clarity and brilliance. It’s either that or outright, contradiction that it will have to walk back over and over again, especially with its ruler, Mercury retrograde. Mercury will also leave its home sign of Gemini and will retrograde back into Taurus on May 23, where it remains until June 23. This might actually be a positive, for in Taurus, one is more apt to use logic to explain their position, which people can then understand a little better. Or, it may mean errors in judgment (Mercury retrograde) that they have to walk back, but they are too stubborn to do so, which just makes the task of moving their agenda forward that much harder. Things get stuck due to inflexibility, when the Sun in Gemini demands the willingness to adapt and adjust.

The most important ingresses, however, involve Mars and Venus. Mars enters Aries on May 24, and Venus enters Taurus on May 28. Venus and Mars will thus ingress into their ruling signs, which gives them strength. It also bodes well for financial markets, because with Jupiter in Aries too, there will be a greater urge to be bold, to take more risks, and that is exactly what equity markets need right now to overcome their malaise.

Furthermore, Mars, when in its ruling sign of Aries (bold actions, risk-taking) will conjoin Jupiter in Aries on May 29, which is another indication of strength and confidence in taking risks. By itself, this would seem to bode well for the markets, for both Mars and Jupiter like the fire sign of Aries. And of course, Venus likes the money sign of Taurus, which it rules. But Mars conjunct Jupiter in Aries could also be a very large military offensive, probably involving Ukraine and Russia. And if it acts out that way, it may cause markets to fall hard, unless the large military offensive is waged by Ukraine and is successful, in which case world indices would likely soar. Don’t rule this out, although the orb of time for something to manifest related to this aspect can be two weeks either way.

The bottom line is that major shifts in collective psychology are underway, starting with the ingress of Jupiter in Aries last week, and both Venus and Mars ingressing into their ruling signs this week, culminating with the new moon and Mars conjunct Jupiter, May 29-30. This can be a time for great optimism and a renewed sense of freedom. It is an excellent cosmic dynamic for fun. So, get ready for a lot of social activity and entertainment. But also keep in mind that if you have too much fun (Jupiter in Aries), or are too careless (Jupiter and Mars in Aries), accidents or hangovers can be the consequence.

As always, party responsibly and know your limits with Mars and Jupiter aligning in Aries, because there is no real freedom for those who don’t know their boundaries and respect those of others. You might need a “Get out of jail” card if you mix stupidity with carelessness under this cosmic combo. It can be humbling. As far as trading goes, there is money to be made or lost (or both), depending on your ability to trade versus overtrade. Mars and Jupiter can be profitable and fun, even huge fun. But it can also be greedy and result in losses if greed and excess are not under control. This, too, can be humbling or rewarding, depending on your attention and ability to manage risk.