Stock Market Astrology VII

Stock Market movements are governed by mainly five factors - fundamental,

technical, macroeconomic, political & planetary !

Nelson who wrote the 'ABC of Stock Speculation ' designated the research

findings of Dow Jones as the Dow Jones Theory. Charles Dow was frank in

stating that his Theory is not infallible and that the real method of

forecasting the duration or extent of a primary trend was unknown to

Technical Analysis !

Identifying the Primary Trend is difficult. Even Secondary Reactions are

deceptive. There is only one Science which can forecast this and it is Stock

Market Astrology !

Fundamental Analysis concentrates on the Intrinsic Value of the Share, but

Intrinsic Value has no practical value, as stock prices are either

overpriced or underpriced. Technical Analysis can indicate whether the

market is bearish or bullish, but cannot easily identify trends. The

beginning of a Primary Bull Market may appear as a bear rally. Similarly the

start of a Primary Bear Market may appear as a bull decline. There are

unknown & hidden factors determining stock market movements like

macroeconomic, political and planetary factors. Neither Nelson's book ' The

ABC of Stock Speculation' nor Hamilton's " Stock Market Barometer"

supposed to be a Bible for stock investors ) take these hidden factors into

consideration. Stock Market Astrology alone takes into cognizance all the

five fundamental factors and can identify primary trends and secondary

reactions !

In our earlier articles, we have already given all the five factors

responsible for the major bull run on the Indian bourses.

Correlation of Planetary Cycles & Economic Cycles

Jupiter Cycles & Indian Economy

When the Narasimha Rao Government initiated liberalisation in 1991, India's

GDP growth was just 3 %. After that GDP grew at an average 6%. Jupiter was

in Leo in 1991 and now Jupiter has completed one Jupiter Cycle of 12 years.

He is starting another cycle and we will have better growth. His transit of

Scorpio was a bullish factor for India ( He was in India's lunar fifth, till

Nov ) Economic boom ( Vitha Samruddhi ) has always been predicted when

Jupiter transits the 2nd. CMIE points out that this year GDP growth will be

7.4 %.

We had in our earlier articles identified the primary trend as bullish. A

secondary reaction is expected at any moment now. The market can dip by

about 400/500 points and we have already warned our subscribers about this

danger. During the market dip you can either hold your portfolio or sell off

at high levels and enter at low levels !

The Dow Jones Theory states that Markets move in three trends - primary,

secondary & tertiary.

Primary Movement

The first, and the most important is the primary trend which is the broad

trend ( which is upward or downward ) which is known as a bull or bear

market extending over periods which may vary from less than a year to

several years and is generally interrupted by secondary reactions.

Secondary Movement

Second and the most deceptive movement is the secondary reaction - an

important decline in a bull market or a rally in a primary bear market and

which usually lasts from three weeks to three months.

Tertiary Movement

The third movement is the daily fluctuation. This is the least important of

all the three movements.

The Primary Bull Market

Averaging more than 2 years, a primary bull market is a broad upward

movement, interrupted by secondary reactions Due to improved business

conditions and increase in speculative activity stock prices advance because

of demand created by both speculation and investment.

There three characteristics of a bull period are

1) Revival of business confidence due to optimism

2) The rise of stock prices to the known improvement in corporate earnings.

3) Speculation is rampant - a period when stocks rise on expectations &

euphoria.

We have seen that there is an economic revival, corporate earnings have gone

up and speculation is becoming the order of the day.

The investor population is confused, they do not know whether it is the end

of a Bull Phase and the beginning of a Bear Phase. I was talking to a friend

and he is of the opinion that the market is overheated and may crash at any

moment ! Things are not so.