(17 December 2018)  All eyes are on Federal Reserve Chair Jay Powell this week.  Given recent volatility in financial markets, this Wednesday’s FOMC statement and press conference will be more carefully watched than usual.  Up to now, Powell had indicated a preference for raising rates in December and then several more times through 2019.  This path of "interest rate normalization" was intended to keep inflation under control to avoid overheating the strong US economy. 

But recent economic data have been more mixed and could force the Fed to rethink its approach.  The US housing sector is showing signs of slowing, and global growth is also looking weaker as China may be compelled to undertake yet another stimulus program.  And then there are the financial markets themselves. 

While it is not an explicit part of the Fed’s mandate, it is clear that a falling stock market undermines the "wealth effect" which can thereby dampen investment and business activity.  And since the stock market is sitting precariously on key technical support levels (SPX = 2600, Dow = 24,000), the market may force the Fed’s hand.  More than a few observers are now calling for the Fed to save the market by either cancelling its widely telegraphed December hike, or more likely, to dial back its hawkish plan for three or four hikes in 2019, to two or even just one. 

So will Fed Chair Powell be Santa or Scrooge on Wednesday?  And more to the point, how will the market react?  His personal horoscope looks a little stressed but nothing too major just yet.  Mars is aspecting his Moon by the full strength 8th house aspect but that may simply reflect the enormous personal stress Powell is under given the historical significance of this rate decision.  Rahu (North Lunar Node) aspects the natal Mars but it is past exact and thus likely diminishing in its influence. 

As a general rule, I would think that if the market sells off sharply after Wednesday, it should show up in Powell’s chart since it is unlikely that he would desire this kind of outcome.  Of course, we cannot know for sure what Powell and the Fed really wants, since a sell-off would at least push more investors into bonds thus lowering yields.  Lower rates on the burgeoning US debt could be very much what want the Fed ultimately wants, but perhaps not at the expense of all those 401Ks.

Therefore, we can say that Powell’s horoscope doesn’t really provide evidence for a bullish or bearish outcome this week.  I think Powell is likely to become more frustrated and depressed in 2019 as Saturn closely squares his Virgo Moon.  This will likely reflect the bear market that I can see emerging in 2019. 

But for now the transits similarly seem somewhat mixed.  For the bulls, Mercury conjoins Jupiter on Friday and could well correspond with a favorable reaction to the Wednesday Fed statement.  And yet there is reason to be cautious in this assessment.  First, the Mercury-Jupiter conjunction aligns closely with Saturn.  This introduces a somewhat more negative spin on the proceedings, even if it doesn’t quite push the needle over in the bearish column. 

The other big problem this week is that we are approaching a Full Moon on Saturday, the 22nd.  Full Moons tend to be bearish so it could be more difficult for markets to rally before the Full Moon takes place.  The market declined at the time of the October and November Full Moons so there is some risk this could happen again. 

But I would think a bullish outcome is boosted because of the multi-planet alignment with Venus.  Venus is in a 120 degree alignment with Neptune (within one degree) and Venus also aligns with the Lunar Nodes, Chiron and the Sun if we include multiples of 15 degrees.  While the bullish case is less clear than I would like, all those Venus aspects are hard to reconcile with a negative market reaction the Fed on Wednesday.  It therefore seems more likely that stocks will rise after the FOMC meeting.

So even with the planetary overview, there remains considerable uncertainty about what will happen this week.  But my reading of the planetary influences should make bears uncomfortable as the net effect looks more bullish than bearish, even if I won’t be surprised either way.  Using a 0-100 financial astrology index, I would say the index is greater than 50 this week, probably in the 60-70 range, especially after Wednesday at 2 p.m.  The early week could be more negative. 

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