History Repeats??
Year 2010 has dawned upon us. It is very prudent to look at the potential road-map of the Financial Markets. How do we do that? Well, one of the best of ways is, to look at what has happened in the past. Are there any common denominators, which would help us conclude that we have the same signatures, as we had them in the past.
Currently, there is a lot of hope of recovery. This hope manifested into the remarkable rally of the Financial Markets. This hopeful feeling is supported by the exaggerated attempts of the Governments, who have (created an illusion and) injected trillions of dollars into the economy. I shall leave the discussion of these attempts on some other times.
I have always said that Financial Markets are ruled by the Cycles. One of most familiar cycles known to the mankind is, the Sun, the center of solar system. If life on Earth depends on Sun and Moon has ability to pull zillions of tons of water (in form of high tides) during its Full Moon and New Moon phases, then other planets have certain effects on the human emotions and thus Financial Markets.
The concept of market memory is borrowed from many avenues of life. One of which is the divine quotation from Ecclesiastes (1:9-14 NIV). “What has been, will be again, … what has been done, will be done again; there is nothing new under the Sun”.
I believe astrophysics and its dynamic phenomenon, is one of signatures, which shall trigger the prices levels, to react in the similar fashion (of the past).
As we are discussing the macroeconomics, then outer planets energy shall rule the long term trend of the Financial Markets. (Click on chart to enlarge)
First chart is the comparison of current rally, which started from 03-2009, to the 03-2003 rally which continued into 01-2004 (to be continued…)
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