WallStreetWeather.net Forecast For Week Of October 17, 2010

Jupiter and Neptune energies dominating this week can bring larger market moves that indicate the euphoria might be temporarily peaking out during Venus retrograde which could trigger a sharp selloff at the end of the week.

On Monday until later Wednesday morning the Moon (sentiment) will be in Pisces, a sign ruled by Neptune (and Jupiter before Neptune was discovered). The Sun in Venus-ruled Libra forms a challenging alignment to Jupiter in Pisces while the Sun and Mercury harmonizes with Neptune in Aquarius Monday and Tuesday. These influences can indicate there is still a lingering air of overconfidence and the belief that stocks and commodities are not overbought.

As I described in “The Fallout From Toxic Mortgage Processing,” Pluto in Capricorn makes its final opposition to the USA’s natal Venus on Monday that began on March 8, 2009. Nearly 0% interest rates have allowed banks (and large companies) to issue long term debt cheaply which is helping them to prevent another liquidity crisis like two years ago. Now that the banks have recapitalized, the next stage of their transformation is to work through the origination and processing problems with mortgages from the companies they “advantageously” acquired. Time will tell if Countrywide Financial, WaMu, and Wachovia turn out to be Trojan horses.

Mercury and the Sun engage in challenging alignments to Uranus in Pisces Tuesday and Wednesday which raise the potential for currency reversals and unexpected news that could result in some investors making adjustments to rebalance their portfolios. When Uranus is prominent, volatility tends to increase along with the potential for intraday reversals. Prices move higher or lower than expected.

The Moon is in Aries late Wednesday morning until shortly after the second Full Moon in Aries at 9:37 PM EDT Friday. Mercury enters Scorpio Wednesday evening until November 8, increasing the information that surfaces concerning debt and other financial information that has been kept secret. Fast acting Aries is ruled by Mars which in Scorpio harmonizes with Jupiter in Pisces Wednesday and squares Neptune on Friday.

Pisces and Neptune rule bubbles, and Mars could pierce Neptune’s bubble. At this point, investors might not want to wait to “sell on the news” but rather sell on the rumor in the event it turns out to be a lie. Treasuries are especially vulnerable to a correction, along with commodities mined underground since these relate to Scorpio and its planetary ruler Pluto. (Mars was the ruler of Scorpio before Pluto the mythological lord of the underworld was discovered in 1930.)

Monday, October 18, 2010
Potential for large moves in either or both directions; negative bias.

Tuesday, October 19, 2010
Positive conditions become choppy and turn negative.

Wednesday, October 20, 2010
Choppy/mixed conditions improve to positive.

Thursday, October 21, 2010
Negative bias.

Friday, October 22, 2010
Negative (bearish).

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