PSYCHOLOGICAL BARRIERS

There is a tendency for the stock market to reach significant tops near round number "psychological barriers" in the DJIA (as well as other major indices like the Nasdaq Composite and broad NYSE index). Furthermore, turning points at thousand marks in the DJIA usually occur around the times of significant planetary alignments.

One example of this phenomenon occurred in 1966, when the DJIA reached near the 1000 mark for the first time in history. As can be seen in the chart below, the DJIA reversed sharply from Dow 1000 going into February of 1966, when a major seven-planet alignment took place.

Following this initial reversal from Dow 1000 in 1966, the DJIA reversed from the "Magic 1000" mark several more times over the course of the next two decades- falling by more than 30% on average each time.

In 1982 the DJIA substantially broke above the 1000 mark. Stock prices entered a major bull market and, by 1987, the 2000 mark was successfully breached until that year's August Harmonic Convergence top in stock prices and October crash.

The market recovered from the 1987 crash, climbed well above 2000 and then, in the summer of 1990, the psychological barrier/planetary alignment/stock market topping phenomenon repeated once again. In mid-July of 1990, the DJIA closed at a peak of 2999.75 two days in a row and then entered a three-month, twenty percent collapse into October of that year. This reversal coincided with a six-planet alignment associated with a new/full moon, solar/lunar eclipse pair in mid-July/early-August of 1990.

In 1994, the DJIA approached the psychologically important 4000 mark for the first time in history. The DJIA ran up to a print high of 4002 with the full moon following an exceptionally tight seven-planet alignment in mid-January of that year (the potential influence of the planetary alignment was duly noted in a Wall Street Journal article at the time, "A Rare Planetary Bodes A Bust For Booming Stock Market", 2/12/94, p.B1). Next, the Dow fell by ten percent and remained below the 4000 mark until the following year.

In 1997, the DJIA peaked just above the psychologically significant 7000 mark with a new moon/solar eclipse after a tight seven-planet alignment on February 7th (see http://www.gaiamind.com/). Next, the Dow fell by around ten percent- comparable to the market decline following the seven-planet alignment top at Dow 4000 in 1994.

(NOTE: Stock market reversals from psychologically important thousand marks in the DJIA typically occur around the time of new moons or full moons within a lunar cylce of significant planetary alignments, such as is occurring now.)

The psychological barrier phenomenon appears to be repeating at the current juncture. At present the DJIA is reversing from the 11000 mark in connection with a six-planet alignment. This six planet alignment is associated with the July 28th full moon which also involves a lunar eclipse. As will be explained in the next section, eclipses tend to trigger stock market crashes....a distinct possibility at this juncture.

Each time the DJIA reversed from the "Magic 1000" barrier between 1966 and 1982, there were all kinds of troubles which emerged ranging from OPEC oil embargoes, to the Vietnam War, to Watergate. One of the most notable cases occurred in October of 1973 when the DJIA rose to just below Dow 1000 as the Arabs launched a surprise attack against Israel which, in turn, led to a major East/West confrontation and an Arab oil embargo against the West. Consequently, the world economy entered a severe contraction and stock prices plunged.

In the summer of 1990, the DJIA reversed from 3000 and then Iraq invaded Kuwait, thereby triggered a Persian Gulf crisis and major oil-shock that "caused" the world economy to slip into a recession and stock prices to plunge.

Right after the Dow reversed from the 4000 mark in January of 1994, the Fed hiked interest rates and the stock market entered a year-long correction.

In 1997, when the Dow reversed from the 7000 mark, the Fed again raised interest rates for the first time since 1994 leading to the first ten percent correction since 1994.

Also in 1997, when the DJIA reversed from the 8000 mark several times, each occassion was attributed to the worsening Asian financial crisis. Likewise, these reversals coincided with a developing crisis in the Persian Gulf over U.N. weapons inspections in Iraq.

In 1998, when the DJIA reversed from Dow 9000, it coincided with a climax in last year's international currency crisis which led to 50% drops in the currencies and stock markets of Asian and Latin American countries. In association with the, a major U.S. hedge fund crisis developed, unbeknownst to most investors, that required a Central Bank bail-out of Long Term Capital Management at the cost of tens of billions of dollars.

If the historical pattern is going to repeat here as the DJIA is reversing from the psychologically significant 11000 mark with the full moon/lunar eclipse and a six-planet alignment, then a major stock market top is potentially being reached that will be followed by a substantial stock market decline, possibly triggered by some sort of negative international shock(s).

Given that the negative shocks which have been associated with reversals from thousand marks in the DJIA in the past have ranged from Fed rate hikes to financial crises to Middle Eastern wars, just about any global negative could soon happen. If the stock market has reached a Grand Supercycle top above Dow 11000 (see Part II), then we may be facing some of the most negative shock(s) in human history.

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