Leaning on the stars

by Caroline Allen

 

         Be honest. Do you, from time to time, read your horoscope in the daily free papers?

         Have you even once, while browsing online, been tempted to glance at your personal or professional horoscope, knowing of course, the predictions are completely interchangeable? As the dog days of August fade, the working world resumes its usual patterns, overlaid this year by thick uncertainty among investors. Our financial system is still in shock – far from fully recovered from its recent ills. World markets continue to flop about without direction. Unused to doing nothing, investors become vulnerable to heterodox economic theories.

         So, it should be no surprise financial astrology is making a comeback. Market failings make us question established beliefs with new interpretations – most recently behavioral economics, complexity economics, evolutionary economics, experimental economics, and neuroeconomics, systems that combine whatever bits of research and science suit their proponents.

         Financial soothsaying is as ancient as trading itself. A book called The Bourse of Babylon suggests as long ago as 463 BC, people followed astrology as it related to the price of wheat, keeping their tracking data on clay tablets. Even the great J.P. Morgan himself employed a full-time astrologer.

         W.D. Gann first described the use of angles in the stock market to divide time and price into proportionate parts. The most important angle was the 1x1 or the 45° angle, which he said represented one unit of price for one unit of time.

         Conspicuous success attracts interest. In the 1960s, one Arch Crawford was an assistant to a well-known technical analyst at Merrill Lynch when he read a book by Nicolas Darvas, a nightclub dancer turned market master who made $2m on the stock market – a fortune at the time. Crawford began to investigate the predictive link between astrology and market movements, and followed the Bradley Model, devised by Donald Bradley in 1948.

         After a spell in the Vietnam war, Crawford set about improving the model, mounting a programmable calculator onto a printer to calculate the percentage change in the Dow compared with the alignments of one planet to another. He backmodeled 55 cycles over 74 years, refining Bradley’s system, then left Merrill Lynch and set up a newsletter selling his theory to willing buyers.

         Demand for such services increases after a crisis. Gabriella Mittelman, based in Israel, decided to dedicate herself to astrology after the outburst of the ‘Intifada’. Well you would, wouldn’t you? Her Gemini moon makes her look for new ideas, she says in her blog at www.astroworld.co.il, which runs:

         August 10: See how the Sun’s line is a support in the S&P for the time being. Falling below 1,118, will turn it into a resistance. August 15: Such a boring day, I could hear the grass grow. Trade started with a gap up, disregarding all the obstacles of the planets, then stayed in one line as a dead man’s monitor. August 18: Day ruled by Mercury and the Moon. When a planet is stationary it is more powerful than when in movement. So we can expect surprises, sudden movements.

         In the same magic circle moves Dharmik Timing, run by Christopher Wilson and Daniel Norris, set up after the pair discovered Vedic astrology. Other practitioners include Irma Schogt in the Netherlands, Richard Schultz in the US, Jan van Gemeran in Thailand and Markus Rose in Ireland, while Romanian Daniel Ciuntuc explores the correlations of stochastic oscillators with the perigees and apogees of the moon.

         So if you are not getting inspiration from the readily available views of your favourite managers, cast your eyes to the heavens and feel the power of the planets.

Read more at:  http://www.investmentweek.co.uk/investment-week/opinion/1731250/leaning-stars
Investment Week - News and analysis for investment advisors and wealth managers.

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