The Scott Barometer is the result of many years of my research into the effects of planetary influences upon the markets.
My research into this subject began in 2002. At the time I was becoming interested in the stock market and came across an article where the author was discussing a particular astrological event and its likely effect on the markets at the time. This was the first reference I had seen that linked trading to astrology. I was immediately interested.
I made a decision to find out all I could about how a knowledge of astrology might be applied successfully to trading. My wife had studied astrology herself over many years and holds a qualification from The College of Humanistic Astrology. I was already equipped with a general understanding of planetary influences and how they work. My subsequent search turned up many websites related to the topic. Linking astrology to trading was obviously nothing new. A lot of information was out there, but for the most part I found it difficult to understand and follow. Questions had started forming in my mind that didn’t appear to be answered anywhere.
I purchased my first computer software program from Market Analyst and started researching back in time to try and determine the effect of various astrological energies on the stock market. I printed out 40 years of The Dow one day bar charts and joined these up over a 7 metre expanse of wall. This allowed me to view the continuous movement of The Dow over this period of time.
Underneath these one day bar charts I fixed hand-drawn charts that showed retrogrades, planets changing signs and major transits involving the planets Jupiter, Saturn, Uranus Neptune and Pluto on a weekly basis. Underneath these weekly charts I placed another series of hand-drawn charts that showed retrogrades, planets changing signs and transits involving the planets Mars, Mercury, Venus as well as the Sun and Moon. These were daily charts. A photograph of my “research wall” at the time showing this huge array of charts is included in my book, details of which follow.
The setting up of all these charts was a long and painstaking process. Attention to minute detail was crucial. The reward was that very soon after commencing this project I began to see interesting patterns emerging, relating to each of the above influences. The Dow would move in a particular direction at a particular time, and there, directly underneath and corresponding to the movement was an astrological explanation. I then extended my research to encompass 110 years of Dow Jones movement to further test the theories I was formulating. Every time I had reason to believe a particular influence was having an effect on market movement, I would spend large amounts of time going back through the history of the Dow to observe the market behaviour whenever that particular energy had previously been in play. I began to formulate expectations of which energy or combination of energies were likely to result in an upward trend (short, medium or long term) and which were likely to result in a downward trend.
The result of this research became a huge body of evidence indicating that particular planets retrograding will historically have an effect on market direction. Planets changing signs will have an effect on market direction, as will both major and minor transits. The explanation of these findings and the supporting evidence became the subject of a book that I wrote in 2010 entitled
“A Compendium of Astro-Economic Influences Practically Applied to 110 Years of The Dow Jones Industrial Averages”. http://www.sacredscience.com/Scott/AstroEconomicInfluences.htm
In more recent years I turned my attention to how the cycles I identified influenced other markets such as currencies, commodities, other indexes and stocks. In each case I was able to find strong correlations.
Once I had identified a range of market triggers and their historical effect on market movements, the task then began of weighing these influences. Obviously at any one time there is going to be a plethora of astrological influences in play. Some indicating a positive influence while others exerting a negative influence at the same time. The final result is the Scott Barometer.
It’s important to note when referring to the barometer that it does not behave as a moving average. The barometer consists of four moving lines; brown indicating short term astrological influences, red indicating mid-term astrological influences and blue indicating long term astrological influences. All are based on the cycles I have identified and followed over a period which now extends to 115 years on the Dow Jones Index. The green line is a combination of this information.
When using the barometer I suggest having the page horizontally centred with equal space given to the bar chart and the barometer as in the examples below. It’s then a matter of scrolling through the Dow Jones Index/Stock/Commodity and following the peaks and troughs. The right-hand panels show the market value above and the value that the barometer has attributed to the prevailing influences below. This is best done on a One Day Bar or Candle Chart that includes the weekend. The weekends must be included to cater for time zone differences.
Following are examples of the behaviour of the barometer against a sample of different markets. In each chart a selection of peaks and troughs have been marked.
CHART 1 – DOW JONES
CHART 2 – USDJPY
The following four charts track USDJPY over a period from January, 2015 to March, 2016.
In the above example I have chosen to use green vertical lines to highlight three weekends. Movements programmed into the barometer will remain active over the weekend, although of course trading is not occurring. This can lead to a perceived distortion where it appears the barometer is not following the market. It’s important when using the barometer to be aware of weekends.
CHART 3 – USDJPY
CHART 4 – USDJPY
CHART 5 – USDJPY
CHART 6 – LIGHT SWEET CRUDE OIL FUTURES
CHART 7 – VISA (NYSE)
The primary goal of my research over the years has been to determine the ongoing energetic background environment the market is travelling through at all times. In the Scott Barometer, this environment is defined by the summation of the underlying planetary energies at any time. As always, good risk management is essential. For myself, lessons learnt over the years have included always being aware of planetary transits to my own natal chart.