Astrology, Prediction and Comment

As I write the markets are crashing.  The Dow Jones is down, gold and silver are down, and Bitcoin has been smashed.  I suppose that was something to do with the Full Moon at the beginning of the week, which coincided with a Venus-Saturn opposition.  That makes sense.  Venus is the planet of money, and a hard aspect with Saturn is going to lead to financial losses.

However, I don’t want to get too hung up with astrology.  There are other ways of looking at the world.  And with reference to Bitcoin, we need to consider how it relates to other financial assets.  One way of doing this is with correlation.  When two assets go up one-for-one with each other, they have a perfect correlation, of 1.  But when one goes up and the other goes down, in inverse lock-step, the correlation is -1.  Looking at Bitcoin since April 2013, we can see the following correlations:

Over the last seven and a half years Bitcoin has a correlation of .87 with the Standand and Poor, which is the most important measure of the US stock market.  As the stock market goes up, so does Bitcoin.  There is also a positive correlation with GLD, the gold ETF, of .56.  The correlation with the Dollar Index is weaker, at .30, and with SLV, the silver ETF, it is slightly negative, at -.18.

I should say that in an ideal world I should have taken the spot prices for silver and gold, rather than their ETF surrogates.  However, they are a pretty good match, even counting for the small shrinkages caused by managment fees.

If we take these correlations at face value, we might argue that Bitcoin is a risk-on asset.  It goes up as the markets go up, and it is not averse to a strong dollar.  Yet correlations can be treacherous, and they can quickly break down.  You can see this in the graph of the 100-day correlation between Bitcoin and the Standard & Poor:

At the end of 2019 the 100-day correlation was almost -.75, with Bitcoin and the S & P moving in opposite directions.  By early September 2020, the correlation was sky-high, at .86.  This correlation may hold, as it did through 2017, but it might break down.  This is possibly what many Bitcoin bulls are hoping for.  They want Bitcoin to be regarded as a safe-haven asset, that investors will run to in times of crisis.  The broad correlation since 2013 suggests this is not the case, but in the markets correlations can change very quickly.

Another asset that apparently has a big influence on the price of Bitcoin is the Dollar.  Over the last few months Bitcoin has been seen as an anti-Dollar asset, along with gold and silver.  So many investors have been buying Bitcoin out of fear rather than greed.  They see it as a safe-haven asset, that can protect them from inflation and a collapsing dollar.   This has been reflected in a developing negative 100-day correlation between Bitcoin and the Dollar Index:

The 100-day correlation between Bitcoin and the Dollar Index started 2020 at .28, and peaked at the beginning of March at .58.  Then the markets crashed, including Bitcoin.  Everyone took refuge in the dollar, and the inverse correlation was established.  Then as Bitcoin recovered from its lows the Dollar started falling.  The fall continued, with investors worrying that the Federal Reserve was going to print the Dollar into oblivion.

And here’s Bitcoin’s correlation with the gold ETF:

Since the beginning of 2019 the correlation has been increasing, perhaps as people started seeing Bitcoin as digital gold.  With the silver ETF, it is only in 2020 that the two assets have really connected, and by September 2 the correlation was .88:

We now move to a more complex analysis, namely multiple regression.  This involves looking at how a range of assets impact Bitcoin.  The predictor assets are the Standard and Poor, the Dollar Index and the gold and silver ETFs.  Here’s the standardized regression table:

All four predictor variables have a significant impact on Bitcoin, though the absolute betas (see the estimate column) are particularly high for the Standard and Poor and the Dollar Index.  The overall model accounts for 81% of the variance in the Bitcoin price.  It all seems straighforward, doesn’t it?

It is true that regressions and correlations are part of the standard fare of financial analysis.  They are a good way of proving a point, and they are difficult to argue with.  Unfortuntely, there is a problem.  One of the assumptions of regression and correlation is that every data point is independent, and doesn’t influence other data points.  If I randomly select 20 American school children, and correlate their math and English scores, I can be reasonably confident that the scores of one child are not influencing another child’s.  However, when you are dealing with asset prices there is a high level of dependence.  The price of Bitcoin today is going to have an influence on what it is tomorrow.  And if you use regression to predict the price of bitcoin, the difference between the predicted price and the actual price can be similar for days and weeks at a time.

I can take the regression model of Bitcoin, using the four predictors, and compare the predicted price with the error.  If the data points are independent, rather than feeding on each other, one would expect the graph to be an unpatterned mess.  Instead we get this:

It looks rather like a witch’s hat.  Patterns all over the place, and a clear sign that there is something wrong with the regression. We can visualize these residuals in another way, using time on the x axis:

For a linear regression the residuals, or the errors, should not be behaving like this, and we therefore need to make an adustment, to deal with the autocorrelation of the errors.  So we’ll use the Cochrane-Orcutt adjustment.  This gives us the following standardized regression table:

In the unadjusted regression 81% of the variance is explained by the Standard and Poor, the Dollar, gold and silver.  After we adjust for autocorrelation, it crashes to 3%.  Yes, the Standard and Poor and gold have a statistically signficant impact on the price of Bitcoin, but the effect is tiny.  Probably not even worth bothering with.  Yes, there will be times when particular assets move with or against Bitcoin, but that doesn’t help when it comes to understanding what actually moves it.

Having said that, correlations come and go, and I have been looking at the time period from 2013 onwards.  If we narrow down the  data, to this year, 2020, we get a stronger set of relationships.  Here is the Cochrane-Orcutt table for 2020:

For this model, over 37% of the variance is explained, and again we see that the Standard and Poor and gold are the factors with the influence.  The Dollar Index and silver play no signficant role.  You might nonetheless think that in 2020 the Dollar Index affected the Standard and Poor, but once you have adjusted for autocorrelation there is no statistically signficant relationship.

So what does this exercise tell us?  The Standard and Poor and gold have a small but signficant impact on Bitcoin.  The Dollar Index has no impact.  And even if you see a correlation between two assets, it can disappear in the blink of an eye.  In terms of forecasting the Bitcoin price, you might as well use astrology, and I am confident that the Jupiter-Saturn conjunct on December 21 2020  will propel Bitcoin to new, six-figure highs in the years to come.

You’re not supposed to comment on the horoscopes of children, certainly not in a negative way.  However if that child is being brought up to be the King of the United Kingdom, then it may be appropriate to look at the horoscope in a critical manner.  Of course being King isn’t what it used to be.  The position doesn’t have much power, and over the next century the position may be further eroded, or even abolished.

The child in question is seven-year old Prince George, who is third in line to the throne, after his grandfather Prince Charles and his father Prince William.  George is unlikely to be King for a very long time.  According to UK life tables Prince William is expected to live for another 42 years.  However, William’s paternal grandparents are both in their 90s, and we can therefore give him at least another 50 years.  This means that Prince George will be in his 60s or even 70s when he becomes King, so does it really matter?

It probably doesn’t, but I can’t help thinking that George doesn’t have the right horoscope to be King.  His is at the top of this article, and is set for July 22 2013 at 4.24 pm, in Paddington, London.

The first point to make about the chart is that it is massively Watery.  Five of the seven traditional places are in Water signs: the Sun, Mercury, Mars and Jupiter in Cancer, and Saturn in Scorpio.  There is also a Scorpio Ascendant.  The other two traditional planets are in Earth signs: the Moon in Capricorn and Venus in Virgo.  This means that there are no traditional planets in the positive elements of Fire and Air.  In other words he’s all Yin and no Yang.  A sensor and reflector of everything happening around him.

The Sun in Cancer is particularly interesting.  If George had been born 32 minutes later, the Sun would have gone into Leo, and the sensitivity and negativity of his horoscope would be far less pronounced.  But it does seem that the British royal family has found it difficult to avoid the sign Cancer.  The last King to be a Cancerian was Edward VIII, born on June 23 1894.  He allowed his emotions to over-rule duty and common sense, and his insistence on marrying Wallis Simpson led to his abdication, after less than eleven months in the job.

Then came Princess Diana, a Cancerian born on July 1 1961.  She re-infected the royal family with the Cancer star sign.  Her first son William was born on June 21 1982 at 9.03 pm.  Like George, he is only just a Cancer – if he had been born at 6.23 pm or earlier he would have been a Gemini.  So Prince George is a third generation Cancerian, and in him the properties of the sign are highly  concentrated – after all, he doesn’t just have the Sun in Cancer, but also Mercury, Mars and Jupiter.

Such concentration is likely to bring great subjectivity, and it may be difficult for George to look at the world objectively.  He is likely to see things in terms of his own personal perspective on the world. This is probably not a good trait for a British King, whose job is to advice, encourage and warn.  He is supposed to put feelings to one side, and George, with so much Water in his chart, may find this impossible to do.

Matters aren’t helped by the fact that George was born just before a Full Moon, the Moon in Capricorn being opposition the Sun in Cancer.  This suggests a certain moodiness, swinging from one extreme to another relatively quickly.  This tendency will  get stronger as he grows older, and it can be experienced as a rapid alternation between the warmth of the Cancer Sun and the self-interest of the Moon in Capricorn.  However it manifests, it won’t sit easily with his public profile.

Yet there is one sign of kingship.  At the time of George’s birth Venus was at 0 degrees 8 minutes Virgo – in other words exactly conjunct Regulus, the royal star.  This might simply signify a royal birth – something moves onto Regulus, and out pops a royal baby.  Though in terms of personality and destiny it is strange that it is Venus that is on Regulus.  Venus, after all, is a female planet.  It may hint at another person in his life.  For example, he might marry a woman who is very keen for him to be King.  Or more plausibly, it may indicate that he  removes himself from the succession, in favour of his sister Charlotte.

I think this is the best scenario.  Prince George’s horoscope indicates that he is not cut out to be either King or heir apparent.  And when he realizes what being King really means, he probably won’t  want the stress and responsibility.  So ideally in his late teens or early 20s he’ll be supported in his decision to stand down and make way for his sister.

The summer is over.  Back to reality.  If you’re American, you might be able to drag summer on for another week, until Labor Day on September 7.  For many of us it is a poignant time of year.  In the Northern Hemisphere  the summer is burning itself out, and thoughts turn to death and ageing.  Maybe from an evolutionary perspective we thing back to our agricultural roots.  The summer brings the possibility of famine, as stockpiles run low in the run up to the harvest.  The ageing comes from the new school year.  We’ve moved on another year, and some of us have disappeared.

In terms of astrology, at the beginning of the week Jupiter and Saturn are at their maximum separation.  It is like thinking the situation is getting better, when we see the pendulum swing to its maximum distance from our neck.  But gravity will force it back, and the blade will move down a millimeter closer to our jugular.  This means that all of us have to start battening down.  Things aren’t going to get better, and you don’t need astrology to work that out.  Nonetheless, astrology gives us a symbolic language for making sense of the situation.

The big event of the week is a Full Moon, on Wednesday September 2, at 1.22 am Eastern Standard Time.  Here’s the chart of the Full Moon, set for Washington DC:

The chart has a number of interesting features.  Venus, at 25 36 Cancer, is oppostion Saturn at 25 degrees 55 Capricorn.  This opposition in turn makes a 45/135 degree aspect to the Full Moon, at 10 12 Pisces.  The Venus-Saturn aspect has a number of dimensions.  Venus is the planet of beauty, fashion, women and love.  It is a time when women in general are going to feel pressurized, particularly if they are in the public eye.  So actresses and female politicians may not have much fun in early September.  It is also a bad time for making decisions about beauty and decor, and it is particularly important that cosmetic procedures be avoided.

Venus is also the planet of money, and with Venus aspecting Saturn, at the time of a Full Moon, there will be a growing realization that money is a big problem – on both a personal and national level. I know things are already bad on a financial level, but they are going to get worse, and the Venus-Saturn aspect helps symbolize the deterioration.  So to reiterate the message, be careful with money and DON’T BUY ANYTHING UNLESS IT IS ABSOLUTELY NECESSARY.  This applies even if you’re rich – you could end up buying expensive garbage.

Talking about rich people, here is Donald Trump’s horoscope:

Have a look at Donald’s Venus.  It is at 25 degrees 44 minutes Cancer, conjunct Saturn at 23 degrees 49 minutes Cancer.  This tells us that he is someone that has difficult relationships, and that at times he can be disrespectful towards women.  On Tuesday September 2 Venus is conjunct his Venus, and Saturn is making an opposition to it.  And it is all given added power by the Full Moon.

We might therefore expect Donald to have Venus-Saturn experiences around the time of the Full Moon.  Some of which may never become public.  He may have problems with women and he may behave badly towards them.  He will be particularly vulnerable to revelations about past behavior, relating to women, money or both.  If Donald has behaved sleazily in the past, his sleaze might bubble to the surface.  Put another way, if anyone has got any revelation to make about Trump, now is the perfect time to bring it out into the open – it would cause maximum damage.

Venus is also ruler of Trump’s Taurus Midheaven.  The Venus-Saturn aspect is likely to undermine his leadership, and create a new hurdle to his re-election.  We can also see this in the Full Moon chart set for Washington DC.  There is an applying conjunction between the Moon and Neptune, on the Midheaven.  Confused leadership, confused progress – not helped by the fact that COVID-19 is far from beaten.

Have a look at the night sky.  At around 11 pm, to your south, you’ll see Jupiter, clouds permitting.  Look a few degrees to the left of Jupiter, and you’ll another planet.  Not as bright as Jupiter, but still pretty clear.  That’s Saturn.  If you have a telescope or a good pair of binoculars, take a good look at Jupiter.  You’ll see its largest moons.  Then turn your attention to Saturn, and check out its rings.

The spectacle won’t last forever.  From the Earth’s persective, the Sun is moving towards Jupiter and Saturn, and they’ll become visible later and later in the evening and night.  What we are witnessing is the lead-up to the Jupiter-Saturn conjunction, which takes place just before Christmas, on December 21.  But right now, in late August, Jupiter and Saturn appear to be moving apart.  Right at the end of the month their angular separation is at a maximum, and through September they start getting closer.

From an astrological view, the movements of Jupiter and Saturn suggest that the real global crisis hasn’t really started.  Or as Winston Churchill might have put it, it’s the end of the beginning.  Talking about the Second World War, we’re arguably in a phoney war, like Britain and France were, in late 1939 and early 1940.  At that time, Jupiter and Saturn were also moving towards a conjunction.  The start of the war with Germany didn’t directly impact the people of Paris and London, and it wasn’t until the summer of 1940 that German troops marched into Paris and German bombers started dropping theirs loads over London.  The 1940 Jupiter-Saturn conjunction was on August 7 and August 8.  By that time, France was under German occupation and the Battle of Britain was in full swing.

Moving forward eighty years, and a lot of what I say is obvious, and doesn’t need astrology.  The global economy is holed below the waterline but many people are in denial.  They think a vaccine for the COVID-19 is going to save the day, that things are going to get back to normal by Christmas.  You can see this with the property and stock markets – they are going up.  Though bear in mind that markets can go up in a crashing economy, at least in local currency.  Look at the Venezuelan stock market – it is up over six times since the end of March.

As far as September is concerned, Mars is moving very slowly from the Earth’s perspective, and it turns retrograde on September 9.  This is interesting.  Mars is usually regarded as a fast-moving planet, but now it is behaving like one of the gas giants.  To give you an idea of how slow it is becoming, it starts September at 27 degrees 34 Aries and ends September at 25 degrees 3 Aries.  This is bad news, because Saturn starts the month at 25 58 Capricorn and ends the month at 25 20 Capricorn.  Put another way, we have an ongoing Mars-Saturn square.  The Mars-Saturn pairing is about death, annoyance and frustration.  People and governments are going to try their hardest to normalize the situation, but it’ll be a waste of time.  Indeed efforts to get the global economy back on track are doomed to failure.

The highlight of the month is the Autumnal Equinox.  This is the point where the Sun moves south of the celestial equator, when the hours of night and day are equal.  The Equinox happens at 2.31 pm British Summer Time, on September 22 2020.  That’s 1.31 pm GMT, 9.31 am New York time.  Here’s the chart, set for London:

The chart gives a snapshot of the following three months, until the Winter Solstice on December 21 2020.  It is also a good way of seeing the broad, astrological themes.

We can see that Mercury at 24 degrees 15 Libra is opposition Mars at 26 degrees 59 Aries and square Saturn at 25 22 Capricorn.  From a collective perspective, we see anxst, frustration and despair.  The future looks grim, and anger could bubble to the surface.  This is particularly the case as the Moon at 10 38 Sagittarius makes 45/135 degree aspects to all three planets.  The populace, the crowd, the mob, are restless.  And there is almost certainly going to be an unusual level of violence.

Looking at the hypothetical planets, it is worth noting that Jupiter, the planet of optimism and expansion, is at 17 degrees 33 minutes Capricorn, exactly sesquiquadrate Admetos at 2 degrees 30 Gemini.  Admetos is the planet of delay, and from a mythological point of view we have a king who doesn’t want to die – to the extent where a younger person dies in his place.  The central banks want to keep the economy alive, by printing more money – with younger generations having to pay the price.  It is ultimately a waste of time, because the economy is going to die anyway.

We also have the Aries point making a 45 degree aspect to the Neptune-Hades midpoint.  This has been going on for some time, but the Equinox chart reinforces it.  Neptune-Hades is about an infectious disease causing havoc and death.  In other words, there is unlikely to be any respite from the effects of the COVID-19 pandemic.

Have I got anything nice to say?  Well, I think September will be a better month than October.  More about that later.