Monday, March 19, 2012

Chart of the Week: Stock Market Lunacy

Think sun spots and full moons have no effect on human activity? Think again and look at this chart:
[source: marketoracle.co.uk]
Full moons are red dots, while new moons are green dots. Charles Collins found in 1965 that 93 years of stock market data predicted a stock market top is due when yearly sunspot activity exceeds 50. In 1968 Edward Dewey found 43 business activities that fluctuate with the sun's 11 year cycle. More recently, research has shown that stock returns are double in the 15 days around the new moon, for all major US indices based on 100 years of data. Remember folks, full moons and US Person are bad for business!