Review and Preview
Hopes for a robust earnings season from the largest communications and tech companies sparked a rally in mega-cap stocks during the holiday-shortened week, pushing the broader market higher (but)…. Investors reassessed the outlook for President Joe Biden’s ambitious COVID-19 stimulus plan. A growing number of Republicans have expressed doubts over the need for another stimulus bill, especially one with a price tag of $1.9 trillion proposed by Biden. Yun Li and Thomas Frank, “S&P 500 Slips from All-Time High, NASDAQ Ends Week Up 4% at a Record,” www.cnbc.com, January 22, 2021.
In the week that finally saw the end of the Trump era and start of the Biden presidency in the United States, world equity markets rallied with several making new all-time or multi-year highs. Those nations that posted new all-time highs included the United States and India. Those that posted new multi-year highs included the Netherlands and China.
However, the news was not very positive on the global pandemic front as new record cases of COVID-19 were reported. And despite the continued rollout of vaccines, the lack of coordination of adequate supplies and their distribution, plus not to mention onerous amounts of paperwork, are becoming a source of much frustration. There is also concern with market chartists over the increasing cases of intermarket bearish divergence across the globe. After reaching new all-time or multi-year highs over the ten days prior to last week, the German DAX, Japanese Nikkei, and Brazilian Bovespa indices could not follow through last week. Market rallies seem to be stalling. Given that we are in the important geocosmic critical reversal period of January 14-28, the situation could easily turn into a reversal if upward momentum doesn’t return this week.
Gold and Silver had an interesting week. Gold fell to 1800 on the first day of trading last week, but then recovered to close back above 1850. Silver tested 24.00 for the first time in a month but recovered to test 26.00 two days later and ended the week above 25.50. On the other hand, Bitcoin broke below 30,000 late in the week after posting its all-time high of around 42,000 two weeks earlier. Grain markets were equally volatile. Since making new multi-year highs the prior week (January 14), each fell hard by Friday, January 22. The explosive nature of Uranus signatures during the last two weeks may not have hit the stock market yet, but it is in full throttle in Bitcoin and grain markets.
The left will try to convince Biden that he has a mandate for progressive change. He doesn’t. – Jason L. Riley, “Can the New President Avoid Obama’s First-Term Mistake?” Wall Street Journal, January 20, 2021.
It is anything but patriotic to attack the integrity of U.S. elections and democracy with rumors, anecdotes, and pseudo statistics. Over the chessboard, I’m a famously sore loser. But I learned that if you don’t accept that you lost, and understand why, you’ll keep on losing. Garry Kasparov, “The GOP Hit Rock Bottom, Can Conservatives Recover?” Wall Street Journal, January 22, 2021.
We entered the sun sign of Aquarius last week (January 19 in Europe and the Americas, January 20 in Asia and the Pacific Rim). Aquarius is ruled by the planet Uranus. Both the planet and the sign pertain to change and erratic, unexpected behavior, whether in markets or people. In terms of equity markets, price activity tends to be choppy, with many past instances of sudden and sharp selloffs, even after new multi-month or all-time highs.
Of all the sun signs, Aquarius may be the most challenging in which to predict markets in terms of trend, support, or resistance. It may be doubly challenging this year because Uranus is being squared by Saturn and will have a host of other hard aspects from other planets this year. On top of that, Mercury will turn retrograde in Aquarius next week, which is typically another challenging period for traders due to its erratic nature. The message here is to be nimble and not too attached to any position. This is likely to be a market climate favorable for very short-term traders but not an easy one for position traders.
Looking more closely at the heavily-populated time band of geocosmic signatures in effect this week, we find the Sun will conjoin Saturn (January 24) and Jupiter (January 29). It will also square Uranus and Mars (January 26 and February 1). The midpoint is January 28, the same day Venus makes its conjunction with Pluto. Two days later, Mercury will turn retrograde. The danger of a change in investor psychology is very strong during this period, and hence traders will need to be very careful. This can be a very erratic and volatile market with large price swings in very short periods of time. It can also be a time when technical buy and sell signals are negated overnight.
The tension suggested for this week is further augmented by the Leo full moon on January 28, the same period when the Sun will conjoin Jupiter and Venus will conjoin Pluto. With Jupiter being the planet of exaggeration, still in a hard aspect with Uranus, one can see why there might be very large price moves nearby. With Venus conjunct Pluto in Capricorn, the cause may be a conflict over money matters by world leaders: taxes are a Plutonian matter because they represent the purging of one’s assets. Venus represents one’s assets and the wish to secure those assets. Even though they are conjunct, they rule opposite signs (Taurus and Scorpio), and hence the greater probability of a conflict about who owns what and who deserves more or less. But Pluto also pertains to matters like impeachment or punishment. Venus and Pluto are in Capricorn, which is the sign demanding accountability and subsequent pressure for consequences. All of this is happening at a time when the new U.S. President is calling for unity and healing. Pluto can be a cosmic agent for healing. Still, it can also be a correlate for revenge, and I suspect we will hear strong arguments on both sides of the aisle this week on impeachment, taxes, and maybe even reparations, with the thread of unity trying to tie it all together.
It’s a new day in America, so there is a sense of hope. But realistically, the message from the cosmos suggests that all is not stable yet, whether politically or in terms of the health crisis. Yet the cosmos also proposes that come spring, the collective attitude may begin breathing a more sustained sigh of relief from the hardships of 2020 really starting to fade. Jupiter will be rising in Aquarius on the vernal equinox (March 20) in Washington, D.C. Jupiter likes to bust out and party. Our call remains that the pandemic will also begin to recede by May when transiting Neptune begins to separate from its opposition to the super-charged degrees of 15-19 Virgo, where the Uranus/Pluto conjunction took place in 1965-1966. If not, then COVID could continue until 2024-2025. But with Jupiter rising in Aquarius this spring in the nation’s capital, and given that Jupiter in Aquarius has a strong tendency towards optimism, there must be a reason behind it. These two signatures together lead me likewise to be optimistic about March-June.