Investing with the Moon

Outlook May 23

Posted by Danny on May 23, 2011

The recent lunar Red Period ended with a 24 point loss for the Nasdaq.
So our cycles continue to be well on track, the question is for how long.

We are now entering a new lunar Green Period, which normally favors rising stock prices.
Let’s have a look at the chart for the S&P 500 (click for larger image):


The market has dropped right to its long term support trendline. The trend is still intact, but any further drop from these levels will put the uptrend in serious question. Two closes below 1320 or a move below 1300, would be a signal for me to leave this market, despite the fact that we are in a Green Period. There is just too much risk for a sizeable drop here, given that the S&P is up 30% since last summer.
If we move above 1340 this week, then I would consider it a buy signal.

Sometimes one has to take more of a wait-and-see stance, and such a time is now.
The impending end of the QE2 program is only one of the things that unnerves investors for the moment.

Good luck, Danny

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