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The Federal Reserve Board said Wednesday it would raise short-term interest rates and keep lifting them this year, moving the central bank into a new, more aggressive phase of draining easy money from the financial system as the economy improves. “The simple message is the economy’s doing well,” said Fed Chairwoman Janet Yellen following the Fed’s two-day policy meeting. “We have confidence in the robustness of the economy and its resilience to shocks.” Nick Timiraos and Kate Davidson, “Fed Raises Rates, Signals Gradual Increase Ahead,” Wall Street Journal, March 16, 2017.
And on that announcement – that the Fed will increase its short-term Fed Funds rates for the third consecutive time in 15 months – the markets cheered. Almost all markets went up. The DJIA soared over 200 points from its low of Tuesday to its high two days later. Gold was testing its 1194.50 low of March 10 just prior to the announcement on March 15, and then suddenly sprang up nearly $40.00 by the next day. Silver was making a new weekly low at 16.82 on Wednesday before the announcement– thus making a case for intermarket bullish divergence to Gold, which did not take out its previous week’s low. By Thursday, one day later, Silver was up to 17.58. Even Treasuries soared on the news of raising rates. Somehow, the Fed convincingly sold the report as bullish for the economy and people bought the idea that rising rates will not derail the economy, but actually strengthen it.
These kinds of responses, under Venus retrograde, may not prove to be ultimately correct. There are inconsistencies between the Fed’s words and its projections. For instance, the Fed also announced the economy is approaching its 2% inflation target – and again, the market bought the pitch that the Fed will really be able to control inflation at its target. But think about it a second. If the economy is looking so great, why does the Fed forecast only a 2% growth rate this year, and next year, and the year after that? Does that sound like growth?
The Fed also said that in the next two years, the jobless rate won’t increase – it will not go below 4.5% - and inflation won’t rise over 2%. In other words, according to Thursday’s Wall Street Journal editorial page, “Apparently, the Fed thinks the US economy has achieved a glorious equilibrium that will continue indefinitely.” Really? Not according to our understanding of Financial Astrology. All of this love fest, from the market to the Fed, is taking place under Venus retrograde (Venus is love and money). Maybe these projected values (Venus) will change once Venus turns direct (April 15). Maybe they will change up to two-three months later, possibly even next week. With Venus retrograde, one’s opinions, beliefs, and proclamations, made under the retrograde, change almost seamlessly. It is so subtle you don’t even notice until it is too late.
The stock markets around the world rallied on the news of the Fed interest rate hike. The NASDAQ soared to a new all-time high last week. The DJIA and S&P also rallied nicely, but did not confirm the new high breakout in the NASDAQ. Right now, equity indices are looking at a case of intermarket bearish divergence, as the DJIA and S&P remained below their highs of March 1, which was our three-star critical reversal date period of February 27-28, +/- 3 trading days. Similar divergences were noted in Europe and Asia too, where the FTSE and NIFTY made new all-time highs, but other indices in the region did not. Are those making new highs the leaders? Or are they examples of intermarket bearish divergence under Venus retrograde?
Gold and Silver exhibited a similar state of possible misjudgment by investors, related to Venus retrograde. Both Gold and Silver made new cycle highs right on the three-star CRD (geocosmic critical reversal date) of Feb 27-28. They then fell rather sharply into March 10 (Gold) and March 15 (Silver). After the Fed announced its rate hike, both metals began to rally again, but only within a normal corrective retracement zone of a potentially bearish last phase of their primary cycles. If, by the time Venus turns direct, April 15, +/- 1 week, Gold doesn’t exceed 1240, and/or Silver doesn’t exceed 17.90, they will remain vulnerable to a change in sentiment and could easily retest their recent lows. However, as long as last week’s low holds, you cannot rule out that the bull trend is still in force too, especially if they exceed the resistance levels just given. It is typical of Venus retrograde to exhibit conflicting signals and divergences in inter-related markets.
The fact that Fed Chair Janet Yellen made a March rate increase is not a surprise to anyone who reads this column, or our Forecast 2017 Book. This period (February 24-April 21) was highlighted several times as a probable period when rates would rise, according to Financial Astrology studies, even though at the time this was forecasted, market pundits had a very low expectation of a rate hike taking place this early. Such announcements by central banks going into the 6-week period of Venus retrograde are quite common, according to these studies. Not only that, but such announcements at the time Venus turns retrograde will often correspond closely in time to the end of multi-month trends, and the start of counter-trend reversals, in many financial markets. The question is: are those reversals started February 27-March 2 still in effect? If so, this recent rally following the Fed’s announcement of a rate hike last week won’t last. The counter-trend moves started February 27-March 3 may resume into mid-April when Venus turns direct.
SHORT-TERM GEOCOSMICS AND LONGER-TERM THOUGHTS
When the Fed’s forecasting fails, it imperils the economy and the very idea that free markets make people better off. Reform should aim to make the Fed better at its job, so that markets can do theirs.” Todd G. Buchholtz, “A 21st Century Federal Reserve,” Wall Street Journal, March 16, 2017.
… given the new Republican government’s focus on deregulation and tax reform… it is hard to believe “the US economy has achieved a glorious equilibrium that will continue indefinitely.” Wall Street Journal, March 16, 2017, Opinion page, “The Fed’s Era of Contentment.”
Oh, lordy. It is the beginning of a new year this weekend – the new zodiac year, beginning with the sign of Aries, the beginning of spring for those who live north of the equator. Spring is in the air. It seemed like winter would never end, but that may become more the case when (and after) Saturn enters Capricorn on the day of this year’s winter solstice, December 21, 2017. That could spell a really long and cold winter season, maybe two years’ worth. But let’s come back from the future into the present….
For now, we will enter the sign of Aries this weekend for next 30 days (March 20-April 19, 2017). This is about as long as Venus will remain in retrograde (March 4-April 15), during which time it will form a square to Saturn two times (April 5 and April 21).
Here’s the thing about Aries: he/she wants to fly. Aries doesn’t like to take its time. It is impatient and impulsive, often to its detriment. For much of this time, especially April 5-21, Venus will move from Aries to late Pisces, where it will square Saturn. Moving from Aries to Pisces is a downgrade in itself for the natural raw energy associate with Aries. However, the square to Saturn can make the poor Aries absolutely frustrated by the obstacles, blockages, and delays to what it wants to do – and can’t, without resistance, now.
For those of you who thought February 22-March 6 was an exceptional time of powerful geocosmic signatures (it was), keep in mind that it’s not completely over. The next round starts up March 31-April 21, when eleven geocosmic signatures unfold in those 22 days, including Venus turning direct, Saturn turning retrograde, and both making two squares to one another, April 5 and 21. And all of this starts with the second passage of Jupiter square Pluto on March 31 – thus the focus will be upon debt, debt ceilings, deficits, and taxes. These are the kind of conflicts that can frustrate the market, as well as leaders of governments.
These signatures can also highlight frustrations in personal relationships. Here comes Venus retrograde, charging ahead in the fiery “don’t stop-me-now” sign of Aries. And then it retreats back into the dreamy but passive and conflicted romantic love sign of Pisces, which says, “Please don’t stop pursuing me now, but I think we better break up because I see all the baggage you carry and I can’t handle it but why didn’t you tell me the truth because now I have to do something I don’t want to do and please don’t try to find my new email address and new telephone number, but please don’t stop trying to find me….” It goes like that in government and relationships for the next month. It may go like that with financial markets too, where one day these markets explode upwards, and the next day they begin a complete retreat and reversal. It is so typical of Venus retrograde, especially as Venus is moving backwards from the “come-on strong” sign of Aries to “surrender and retreat” dynamic of Pisces.
It is like the Marx brothers’ routine: “I have my principles. And if you don’t like them, I have others.”