Raymond Merriman's preview for week of May 11 including comments on markets, economic perceptions and equities market trends

Weekly Comments for the Week Beginning May 11, 2009
Written by Raymond Merriman

Thursday evening, May 7:
I am writing this week’s report a day early because I will be attending of my son’s college graduation ceremony on Friday, May 8, during the time the markets close. If it is necessary to adjust this report due to Friday’s market activity, I will do so on Saturday.

Review and Preview
Equity markets across the world rallied right into the Mercury retrograde of Thursday, May 7. And then the “Stress tests” for U.S. Banks came out right after the market closed. Well, actually word of the results was leaked out days before May 7, which was a brilliant short-term political strategy, for it led stock markets to new multi-month highs, and with it, an increasing sense of optimism about the future – at least near term. But within the first hour of trading of May 7 (Mercury retrograde-turn day), this incredible 9 week-rally topped out at 8577 in the Dow Jones Industrial Average, and then it sold off over 200 points by the afternoon. It may be the classical “buy the rumor, sell the fact” episode, as a rebound started after market hours, and after the release of the “stress test.”

But isn’t this “flip-flop” typical of Mercury retrograde? Sure it is, and you very well know this if you are a Financial Astrologer. The “trickster” (Mercury), is at its strongest when it turns retrograde, coinciding with all kinds of mixed signals from politicians and economic data releases alike. It is not unusual to see a bullish close one day, suddenly turn to bearish close the next, only to flip-flop again a day or two later. It can be an exciting time for those who are very short-term traders, but it can be a grind for those who are position traders looking for technical signals to complete a suggested move. In non-Mercury retrograde markets, such an expectation and patience is rewarded. In Mercury retrograde markets, such patience is more often punished. Don’t be a masochist. Don’t torture yourself. Learn to take profits quickly now.

Sudden turns on Thursday, the day Mercury turned retrograde, were also noticed in other markets. Crude Oil, for instance, soared to 58.57 early Thursday morning. That was its highest price since November 17 and followed a triple bottom low at 33.55 back on February 12. It was even as low as 43.83 on April 21, just a little over two weeks ago. By late Thursday afternoon, it had already fallen 3.00 from its morning and 5-month high. Soybeans unfolded with a similar story line. Early Thursday morning, prices were at 1145, its highest level since September 29. The bottom was 776 on December 5. As recently as March 2, prices were as low as 843. But by the end of the day (Thursday), Soybeans were already more than 30 cents off that high. In yet other markets, Silver took off last week, surpassing 1400. Just last week – May 1 – prices were testing 1200. Back in October, they were trading in the low 800’s. This one didn’t seem to pull back much as other markets as Mercury turned retrograde, perhaps because the heliocentric position is moving closer and closer to Sagittarius (May 19-30), a time band that acts like a magnet, drawing Silver prices higher into it about 65% of the time. The other 35% it is either flat or severely bearish.

Short-Term Geocosmics
Just because Mercury is retrograde doesn’t mean there isn’t a trend or even a counter-trend move, as is usually the case with Venus retrograde. It just means that the very short-term swings will appear to negate that trend, and then all of a sudden, it is back on. What we want to watch carefully for next week is the May 15-20 period. I will repeat comments made last issue, because I believe they are pertinent as we come closer to this geocosmic critical reversal time band of importance. “I will be most focused on the weekend period of May 15-18, for that is when three things happen. First, that will be around the middle of the retrograde period, when sudden reversals happen. It is more important than usual this time because 2) Saturn will be turning direct that weekend (May 16) and 3) heliocentric Mercury will be entering Sagittarius (May 19-30)… Heliocentric Mercury in Sagittarius also tends to correspond to sharply rising prices in precious metals and currencies, and declines in stock prices. Of course, the other thing we know about Mercury Rx is that whatever you think is suppose to happen, usually doesn’t. Many things go exactly the opposite of what you anticipate.”

Longer-Term Thoughts
Last week witnessed the Dow Jones Industrial Average and NASDAQ (and other world) indices make new cycle highs after Tuesday, May 5. This puts into force our bullish “8-week” rule,” which states that in bull markets, primary cycles will top out after Tuesday of the 9th week. Accordingly, we now have a bullish signal in effect. It means that the low of March 6 was a cycle greater than a primary cycle (it was a 50-week or greater cycle). And according to cycles theory (well, my theory on cycles as elucidated in “Merriman on Market Cycles: The Basics,” as well as Volume 1 of “The Ultimate Book on Stock Market Timing: Cycles and Patterns in the Indexes”), the first “phase” of any cycle is bullish. And when that cycle is longer than the 13-21 week primary cycle, it will be looked upon as a new bull market. That is the case today.

However, readers should also understand that this new “bull market” is headed right into the 14-year Jupiter-Neptune conjunction of May 27-December 21. Jupiter-Neptune is the classical “rose-colored glasses” view of the world. Everything looks great, but nothing can be verified. It’s all based on faith, and reality or direct experience is only something within the confines of one’s imagination. Still, a positive reality must start with a positive and hopeful thought. But the test will be to manifest these great hopes into reality. President Obama is fond of saying, “words matter.” And no doubt, to him and to those he speaks, they do matter. But numbers also matter, because they have a greater capacity to “verify” the words being spoken. So far, we only have this spring. As of yet, there are no “numbers” to substantiate that the Saturn-Uranus opposition crisis in the world economy is really over. Nevertheless, we can be thankful for the respite, for it gives us a chance to reflect on what went wrong, and if we are smart, to make corrections now - before the next wave of Saturn to Uranus (and Pluto with it) hits late this year.

Announcements
The “SOS Global Market Cycles Report” will come out this week, Tuesday, May 12. And it will be out one day later in German to our German & Swiss SOS subscribers (please go to www.mma-europe.ch to order the German version of SOS). This SOS monthly report addresses the long- and intermediate-term cycles that affect all world markets, but specifically through the history of the U.S. stock market, and the Dow Jones Industrial Average. It is the “big picture” ahead, like where we are now in terms of the 72-, 18-, 4-year, and 50-week cycles. It also discusses the shorter cycles (primary and its phases) of the DJIA, German DAX, Netherlands AEX, the Australian All Ordinaries, Hang Seng of Hong Kong, the NASDAQ Composite Index, and the XAU Gold and Silver Mining index. The German edition also covers the Swiss Market Index (SMI). It also includes 3-star critical reversal dates for stock indices and a list of the major geocosmic signatures in effect for the following month, with their appropriate C/S values. For information, go to http://www.mmacycles.com/catalogue/services/the-sos-stock-market-cycles/.

For those interested in learning or improving your understanding of astrology, please note that a fantastic conference in Astrology is going to take place August 19-24, 2009, at the luxurious Oakbrook Hills Marriot Resort, just outside of Chicago (not far from O’Hare Airport). This will be the ISAR (International Society for Astrological Research) 2009 conference, featuring over 80 professional astrologers from all over the world, including Jeff Jawer, Rick Levine, Michael Lutin, Claude Weiss, Nick Campion, Verena Bachmann, and several Financial Astrologers, including myself. There will be a whole track on Financial Astrology, and I will be giving a one-day workshop on Financial Astrology, specializing in the Gold market, on Monday, August 24. For more information, and registration, please go to www.isar2009.com. A fantastic discount cut off date ends May 15, so sign up now to make sure you get the best rate.

If you are an active short-term trader, you may be interested in our Weekly or even Daily Market reports with short-term trading recommendations. It is the only way I keep in touch with traders on a daily or even weekly basis. These reports give in-depth analysis of the DJIA, S&P and NASDAQ futures, Euro currency (cash and futures), Swiss Franc, Dollar/Yen cash and Yen futures, T-Notes, Corn, Soybeans, Wheat, Gold and Silver. The daily reports cover all stock indices listed above, as well as futures in Euro, T-Notes, Soybeans, Gold and Silver. Subscription to the daily report also includes the weekly report. For more information, go to http://www.mmacycles.com/services, or call our offices at 1-248-626-3034. In the words of one of our subscribers: “I recently subscribed to your weekly report and am finding it to be excellent and a very useful companion to the MMA Cycles Report. I can't imagine now managing my investments without them.”

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Disclaimer and statement of purpose:
The purpose of this column is not to predict the future movement of various financial markets. However, that is the purpose of the MMA (Merriman Market Analyst) subscription services. This column is not a subscription service. It is a free service, except in those cases where a fee may be assessed to cover the cost of translating this column from English into a non-English language.
This weekly report is written with the intent to educate the reader on the relationship between astrological factors and collective human activities as they are happening. In this regard, this report will oftentimes report what happened in various stock and financial markets throughout the world in the past week, and discuss that movement in light of the geocosmic signatures that were in effect. It will then identify the geocosmic factors that will be in effect in the next week, or even month, or even years, and the author’s understanding of how these signatures will likely affect human activity in the times to come. The author (Merriman) will do this from a perspective of a cycle’s analyst looking at the military, political, economic, and even financial markets of the world.
It is possible that some forecasts will be made based on these factors. However, the primary goal is to both educate and alert the reader as to the psychological climate we are in, from an astrological perspective. The hope is that it will help the reader understand these psychological dynamics that underlie (or coincide with) the news events and hence financial markets of the day.
No guarantee as to the accuracy of this report is being made here. Any decisions in financial markets are solely the responsibility of the reader, and neither the author nor the publishers assume any responsibility at all for those individual decisions. Reader should understand that futures and options trading are considered high risk.
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