How To Trade Using Financial Astrology

When a company reports better-than-expected earnings, it is no guarantee the price of the stock will move significantly, as any day trader can attest. Traders on the floor of an exchange often slough off such reports, putting a damper on expectations. Similarly, indicators such as volume, momentum or P/E ratios can lead investors to the wrong conclusions. The seeming contrariness of the market leads some investors to the feeling that something else is at work in the markets. Financial astrologers believe they know what that 'something' is.

It would be foolhardy to suggest that one should follow astrological indicators solely as a basis for making financial decisions. Financial astrology should be viewed as an adjunct to the resources of fundamental and technical analyses. While some investors limit themselves to these traditional methods, there is a growing number of traders utilizing astrological analysis to boost the accuracy of their trading decisions.

When technical analysis first came to prominence in the sixties, it was scoffed at by traditional investors. It seemed incomprehensible to some traders that a stock's price could be forecast using only the price history of the stock. Today, financial astrology is met with the same skepticism that was once levelled against the technicians. It is likely only a matter of time before astrological analysis receives widespread acceptance.

In financial astrology, there is a lot of talk about cycles—the 20-year Jupiter-Saturn cycle, the 15-to-20-year Pluto cycle, the 18-year cycle of the lunar nodes, etc. These cycles give an overview of market trends over an extended period of time and are therefore best suited to the needs of the long-term investor. But what about the short-term investor? What method does astrology offer to predict price levels a week or a month from now.

The means to short-term prediction is simpler than one might think. The short-term indicators for a stock's price movement already exist in the form of the historical data for that stock. It is the astrologer's task to correlate the ups and downs in the historical price chart to astrological influences in effect at the time. It is not always easy to see the underlying astrological patterns which affect a stock's price, but with enough patience, the patterns can be evoked. After having done this type of analysis with numerous stocks over several years, I am convinced there is a unique astrological makeup for each stock, much like a birth chart, which makes it possible to accurately predict a stock's future price movement. Once the major price reversals in the historical data have been accounted for, future price reversals can be laid out in a prescribed pattern.

The basis for making trades astrologically is the use of a price chart, in every respect the same as a standard stock chart, which indicates the peaks and valleys of the stock's future price movement. Combined with fundamental and technical analyses, it becomes a powerful tool. The advantages of knowing the major price reversals for a stock in advance are inestimable. Through astrological methods, an investor can participate in all of the price gains for a stock while incurring none of the losses. Through short selling or put options, he may even gain from a stock's downward movement.

In constructing the ups and downs of a stock's movement, the astrologer must consider two things: (1) how sharply a stock price is likely to rise or fall and (2) the duration of the move. The angle of a stock's rise or fall is determined by the strength of the influence which brought it about. To determine the price angle, I use an 11-point system as shown below:

An influence which positively affects the stock creates a price angle ranging from +15° to +75°. A negative influence ranges from -15° to -75°. Neutral influences or little activity will keep the price angle around 0. The angle is chosen by the relative strength of the astrological influence.

The duration of a price move is determined by how long an influence affects the stock without being interrupted by another influence or superceded by a stronger influence.

Knowing the ups and downs for a stock's price is only part of the story. A true chart of future price movement must also contain the elements of projected growth and price trend. Projected growth is an estimate based on the sector and industry for the stock in question. If a stock is in the telecommunications sector and the cell phone manufacture industry, for instance, a sector analysis according to astrological influences can estimate how much (as a percentage) the price is likely to move up or down in a given time period. The changes in trend are determined by the onset of those influences which most powerfully affect the stock. A sample chart of future price movement is given below: