With the continuing dovish monetary policy from the FED any dramatic change in market indices is going to come from an external event(s).
For a number of reasons we are expecting a substantial move in Gold in the 2nd half of 2014. There are both Astrological events and Gold market cycles that should move Gold up. Subscribers have the dates.
For Gold to move substantially will require an event that affects a major currency, a dramatic increase in inflation or some other monetary event. The FED is continuing the taper of bond purchases but is also committed to a low short-term interest rate policy into late 2015 or 2016.
Russia is doing
their part by trying to get a group of countries together that would not use
US$ in international trade. They set the example with the recent gas deal with China.
One event that could derail the FED's plans is a dramatic rise in oil prices due to unrest in the Mid-East. Problems in the
Ukraine could directly affect Europe but only
indirectly affect North America or other countries that trade with Europe or
directly with the Ukraine
That said let's take a look at the indices.
The SP500 is 20 weeks along in it's Primary cycle (nominal 18 week) with a range of 15-23 weeks. It's getting late. Some of our normal signals for a market turn have not worked recently. For example Mercury turning retrograde on June 7 within 2 days of
Neptune turning retrograde on June 9th has been a market
turn signal. In this market it resulted in 3 down days (see the following daily
chart of the SP500.
We are in another time period where there are signals for a market turn. That said we must keep in mind June 30 is a quarter end and therefore stocks will be affected by window dressing to improve the look before earnings announcements.
The Sun is changing signs from the quick thinking, versatile sign of Gemini to the far more cautious sign of Cancer on June 21st. Venus (rules money / resources amongst other things) will be moving out of Taurus (staid and fixed), the sign that it rules into quick moving Gemini on June 23rd.
Cancer is one of the Cardinal signs (summer). Cardinal signs mark the seasons and are action oriented. The other Cardinal signs which mark the seasons are zero degrees of Aries (spring), Libra (fall) and Capricorn ( winter). They are periods of change and for the markets as well. They all need a trigger. In our current passage Mercury just past backwards across the zero degree Cancer point and will pass over it again going forward on July 13. Watch the dates around July 13 +- a couple of tds (trading days). There is a Super Moon on July 12th. That time period is another to watch for a market turn. More about this in a future post.
The signature of the week is Mars opposing Uranus on June 25th a signature for quick changes, violence, sudden catastrophes and terrorists. The type of activity we have seen in
Iraq and the Ukraine.
Another issue we have not mentioned for a few posts is the current period of illusion / delusion often seen around the
retrograde date. These retrograde movements of the slower moving outer planets
cover a period of time, in this case from May
28 to June 29th. On June 29 the Sun
will trine Neptune and the period of
illusion / delusion will come to an end on July 1st when Mercury turns
There are other issues going on which are discussed in the subscription, weekly letter.
We also had a fairly reliable market cycle of 22/44 weeks, see the following chart. This cycle has marked intermediate highs with a couple of exceptions which inverted. This cycle is still in effect but the market would need to reverse very quickly to validate the high this time.
In short there are quite a few signatures pointing to change in the markets. This means a CIT, "Change In Trend". Remember a change in trend is a market that is moving up and reverses down. A change in trend is also a market that is trending up and then goes sideways.
We had added the chart of the Russell 2000 (RUT) a couple of weeks ago as it is felt an index of 2000 stocks is less open to manipulation than the major U.S. index's (SP500, Nasdaq 100 and DJIA).
The Russell 2000 appears to have put in a Primary cycle low on May 15th which means it is entering the 6th week of the Primary cycle. It is thus due for a Major cycle top and pullback potentially to the 1136-1148 area. This is classic as it had a well defined Trading cycle 2 weeks along on the June 3rd pullback.
Following is a repeat of the Primary cycle and it's cycle components.
Primary cycles have an average length of 18 weeks.
Primary cycles most often break down into 3 Major cycles of approx. 6 weeks each. (Note: some behave differently).
Each Major cycle often breaks down into 2 or 3 week Trading cycles. The Trading cycle often gives the trader a second chance of buying the Primary cycle low if the trader missed the actual low. In this case on the June 3rd pullback.
We were expecting volatility and potential big move with the Heliocentric Mercury in Sagittarius transit from June 9 through June 20th. We got it.
We should have noted, but didn't, the Sun quintile (72 degrees) Uranus on June 19. This aspect has a history of big moves in both directions.
The move also pretty much confirms Gold put in a Primary cycle trough on June 3rd. This means we are in the 3rd week changing to the 4th week during the week and could be due for a Trading cycle pullback. Also, the fact we are at the 50% retracement of the move down from March 17th to June 3rd.
Now, wars and conflict have historically been positive for Gold. However, entering the 3rd/4th week of a new Primary and heliocentric Mercury leaving Scorpio into the more somber sign of Capricorn on June 20th, I expect either a pull back or a sideways volatile move. As stated before I think the big move comes in the 2nd half of 2014. I'll go into more detail in an early July for subscribers. They have the dates.
Seasonally this is a weak period for crude, however, with the disruption of crude production in
Iraq, Libya etc. price has shot up.
Unlike Gold, Crude has not defined whether we are at the end of a Primary cycle
(24th week) or we just had the crest of the first Major cycle (7 week). This is
looking more and more like the May 1, trough was the start of a new Primary
cycle and we are 7 weeks along. If
that is the case and we get a Primary cycle with 3 Major cycles then, cycle
wise, we are due for a dip right about now.
That said we have production delays and violence in
and trouble continues in the Ukraine.
The sides are forming in Iraq
with Saudi Arabia
supporting the Sunni's (who else would they support?) and Iran and possibly Russia supporting the
Shiite population in Iraq. This is a bad situation.
The T-square including Mars - Uranus - Pluto been described in a previous posts. These are war like aspects. This week Mars opposes Uranus on June 25th, which is another violent signature which should highlight the war like aspects.
If we get a pull back we should see the 103-104 area. Events on the ground will probably keep the world price of crude high with WTIC traders taking advantage of a situation which really does directly affect North American crude prices at this time.
Other things to watch.
Neptune is active. Neptune
rules Crude and NatGas. There are many issues surrounding both here and in Europe. It should be obvious to even a casual observer,
oil and NatGas are products and their sources that have risen to importance
over this period where Neptune has been
Neptune's active time period will soon be over but keep in mind
Neptune also rules water. Neptune is also early in Pisces, the sign that it rules.
I'm expecting trouble from water, either a lack of water in areas of the world,
or flooding, tsunami or other disaster type situation.
As mentioned last week,
also rules coffee. The following chart is the JO, ETF, for coffee. The green
lines are the Neptune price lines. Notice how
they have acted as both support and resistance. Watch coffee, crude and NatGas
closely in the month of June. I'm expecting volatility and breaks in support /
Coffee got support at the 50% and has just made it above the
Neptune price line (green lines). Watch
Coffee, Crude and Natgas around June 29 when the Sun trines Neptune
and marks the near end of the illusion / delusion time period I've discussed
over the last few weeks.