(8 February 2023) The Fed giveth, and the Fed taketh away. After rallying on Fed Chair Powell’s speech yesterday, stocks fell back down to earth today as comments from other Fed governors took a more hawkish tone. Indexes fell by more than 1% on Wednesday after Fed Governor Christopher Waller warned of a “long fight” against inflation that might require rates being higher for longer than many investors expect.
All these Fed speakers are creating a considerable amount of confusion as market participants try to anticipate when the Fed may finally end its tightening cycle and begin to cut interest rates. While inflation may well have peaked last summer, the most recent jobs report was stronger than expected and showed no signs of slack in the labor market in light of record low unemployment. As long as the labor market is robust, wages will keep trending higher and continue to put upward pressure on consumer prices.
As I noted in last week’s update, the near term planetary situation looks uncertain at best. The horoscope of the Federal Reserve is coming under increased pressure as transiting Mars approaches its conjunction with natal Saturn (20 Taurus) over the next week or so. This Mars affliction may manifest as greater criticism of the way the Fed communicates its policies as well as greater scrutiny of the policies themselves.
The confusion surrounding the Fed’s approach may also damage investor sentiment and produce more skittishness in the markets. Based on this week’s transits, Saturn is assuming a greater prominence in the coming days. In fact, Wednesday’s decline coincided closely with the 30-degree alignment of Mercury (2 Capricorn) with Saturn (2 Aquarius). And yet, this two-factor pattern is probably not the whole reason for today’s selling.
If we look under the surface, we can see that Saturn is involved with larger configurations involving slower moving and more powerful planets. The transit chart cast for Friday, February 10 illustrates this more clearly. Thus, the angular separation of Saturn and Pluto (=28°03) almost exactly matches that of Mars and Uranus (=27°39). When the angular separations of two pairs of planets are equal, their energies tend to resonate more strongly. Since there are two natural malefics planets here — Mars and Saturn — the effect of this configuration is more likely to be bearish on the markets.
A few additional points can be made. First, the conjunction of Mercury with Pluto at 4 Capricorn should serve to amplify the bearish effect of this pattern, although it could also manifest a day before or after given a standard margin of error. We should also note that the Mars-Uranus/Saturn-Pluto alignment won’t be exact until the weekend. While it’s close enough to increase the bearish influence later this week, it’s also possible its effects could be delayed or manifest more fully outside regular trading hours. Also, we can see a possible offsetting bullish influence on Friday (late) as the angular separation of Venus-Neptune almost matches that of Jupiter-Chiron around 5 degrees. However, since this four-planet alignment only becomes exact on Saturday, it is uncertain if its bullish influence will be felt during Friday’s US trading hours.
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Photo Credit: M.V. Jantzen
