Do Lunar Cycles effect Stock Returns.

[raiha]

http://www.fep.up.pt/disciplinas/ce7...r%20Cycles.pdf

Abstract
We find strong lunar cycle effects in stock returns. Specifically, returns in the 15 days
around new moon dates are about double the returns in the 15 days around full moon
dates. This pattern of returns is pervasive; we find it for all major U.S. stock indexes
over the last 100 years and for nearly all major stock indexes of 24 other countries over
the last 30 years. In contrast, we find no reliable or economically important evidence of
lunar cycle effects in return volatility and volume of trading. Taken as a whole, this
evidence is consistent with popular beliefs that lunar cycles affect human behavior.

And what about solar/lumar eclipses and stock market crashes?

it seems we are in the perfect set-up - astrologically-speaking - for the true meltdown to happen in about 3 week's time.

I came across this, which correlates with history, and we are now really in somewhat of the perfect storm:

"Steve Puetz discovered that almost all of the largest stock market crashes in history have occurred around the time of a full moon before or after a solar eclipse, particularly when that full moon is a lunar eclipse .

Consider the following excerpt from Peter Eliades online "Current Observations":

We seldom use much newsletter space for the ideas of others, but the theories we are about to present fit together so well, we believe you will find them as interesting as we do. The two researchers are Steve Puetz (pronounced "pits") and Chris Carolan. Chris just won the 1998 Charles H. Dow Award for his original research and the complete article is offered on his website at [link to www.calendarresearch.com] . The research by Puetz was first noted in our October 10, 1995 newsletter. Here is what we wrote:

"Puetz attempted to discover if eclipses and market crashes were somehow connected. Without discussing our own opinion on the potential connection between astronomical configurations and market timing, let's simply relate to you the basic findings discussed by Puetz. He emphasized that he is not contending that full moons close to solar eclipses cause market crashes. But he does conclude that a full moon in general and a lunar (eclipse) full moon close to solar eclipses, in particular, seem to be the triggering device that allows for the rapid transformation of investor psychology from manic greed to paranoia. He asks what the odds are that eight of the greatest market crashes in history would accidentally fall within a time period of six days before to three days after a full moon that occurred within six weeks of a solar eclipse? His answer is that for all eight crashes to accidentally fall within the required intervals would be .23 raised to the eighth power less than one chance in 127,000."

". . .Puetz) used eight previous crashes in various markets from the Holland Tulip Mania in 1637 through the Tokyo crash in 1990. He noted that market crashes tend to be lumped near the full moons that are also lunar eclipses. In fact, he states, the greatest number of crashes start after the first full moon after a solar eclipse when that full moon is also a lunar eclipse . . Once the panic starts, Puetz notes, it generally lasts from two to four weeks. The tendency has been for the markets to peak a few days ahead of the full moon, move flat to slightly lower --waiting for the full moon to pass. Then on the day of the full moon or slightly after, the brunt of the crash hits the marketplace."

A total solar eclipse will take place on August 1st that will be followed by a lunar eclipse on August 16th. Puetz highlights the likely crash window as being from six days before to three days after a full moon that occurs within six weeks before or after a solar eclipse, particularly if this full moon is a lunar eclipse. This week's full moon (7/18) falls two weeks before the August 1st solar eclipse which means that a stock market crash window has opened that will close early next week. Are we about to enter a panic of some sort here?:

It's possible, but one should note, according to Puetz observation, the greater likelihood for a crash will be around the full moon/lunar eclipse on August 16th that follows the solar eclipse, i.e., between August 10th and August 19th. Furthermore, stock market seasonality is most conducive to panics in the "fall", i.e., September/October.

While the idea that the moon influences mass mood might seem like lunacy, it is nonetheless true. Consider, for instance, a University of Michigan Business School study by Ilia Dichev and Troy Janes. This study examined 100 years of the stock market trends as they relate to the lunar phases. According to it, “Returns in the 15 days around New Moon dates are about double the returns in the 15 days around full moon dates. This pattern of returns is pervasive: We find it for all major U.S stock indexes over the past 100 years and for nearly all major stock indexes of 24 other countries over the last 30 years.”

http://www.traders-talk.com/mb2/inde...&mode=threaded

I'd appreciate the naysayers (as opposed to the soothsayers) to bugger off and leave this thread alone. People heap scorn on that which frightens them. Many an alleged witch would testify to this, had they not sizzled on a variety of Christian stakes.

[Zippyjuan]

We could try looking at some data. Lunar eclipses happen every 28 days but solar eclipses less frequently so let's look at those. First, a look at the Dow Jones from 1980 to 2000. This should provide plenty of data points including the crashes of 1987 and up to the 2000 one.


Now let's find a list of solar eclipses. There are partials too but for simplicity let's just look at total ones. I am going by lists at this site: http://eclipse.gsfc.nasa.gov/lunar.html
July 6th 1982
Dec 20, 1982
May 4th 1985
Oct 28th 1985
April 24th 1986
October 16th 1986
February 20th 1989
August 17, 1989
February 20th 1990

Dec 9th 1992
June 4th 1993
November 29th 1993
April 4th 1996
Sept 27th 1996
Sept 16th 1997
January 21st 2000
July 1st 2000.

As far as the effect of an eclipse on the stock market, I will let you compare the dates with the chart, but the biggest glaring gap I see is the market crash of October 1987- the largest single day drop in the Dow which would certainly qualify it as "one of the largest stock market crashes in history". There is no eclipse around that date. I did not leave it off- there si none- you can check the charts if you like.

The 1929 market crash had a total eclipse happen as close as November 27, 1928- nearly a year before. So now we have two major data points which do not match. The closest one after the 1929 crash was not until April 2nd 1931. The most recent US stock crash was in the year 2000, starting in September of that year. The closest total eclipse was July 1st which may be considered close enough (even though the following full moon would have been August 15th, not September but September is within the six weeks maximum window he gives)- that gives you one out of three market crashes in the US associated with a total solar eclipse. Not much of a corelation in my opinion. Then you have the large list of eclipses which did not preceed or follow any significant market changes.

The lunar cycle is every 28 days so a full moon plus or minus 15 days pretty much covers the entire month (within 15 days- 15 days before to 15 days afterwards is thirty days- unless they mean plus or minus 7 1/2 days on each side). I won't bother digging up info on when those occured but you are free to if you wish of course.

I did not aproach this as a naysayer but to see if it did indeed work. At least the solar eclipse thing does not. And I do have that question about the "fifteen days around a full moon" statement. I do not have info on if the lunar cycle is true.

The article claims about a five percent difference in stock prices during a new moon (higher) vs a comparable full moon period.

And they are using a 15 day period centered on the new/ full moon which would basically cover half the month instead of all of it as I wondered earlier.

[Optatron]

only if women are trading

[dannno]

only if women are trading

Sounds to me like men invest there money around the new moon (when women are generally on their periods) and then cash out and spend it around the full moon (when women are generally more available, ovulating and horny)

[HOLLYWOOD]

Depends... Does Goldman Sachs own the Moon too?

[Knighted]

Lunar cycles affect stock returns? Sure. Not as much as the price of Bangladesh butter does, though...

[tangent4ronpaul]

Any one have a better list of crash dates?

Here are full moons for the ones listed in the second post:
http://home.hiwaay.net/~krcool/Astro/moon/fullmoon.htm

1929
1929 Oct 18 12:05 Fri 2425903.004
Oct 24 1929 CRASH
1929 Nov 17 00:14 Sun 2425932.510


Oct 1987
1987 Sep 7 18:13 Mon 2447046.259
1987 Oct 7 04:13 Wed 2447075.676
Oct 19 1987 CRASH
1987 Nov 5 16:47 Thu 2447105.199

Sep 2000 Day?
2000 Aug 15 05:14 Tue 2451771.718
2000 Sep 13 19:38 Wed 2451801.318
2000 Oct 13 08:54 Fri 2451830.871

Oct 2008
2008 Sep 15 09:15 Mon 2454724.885
Oct 6th - 10th 2008 CRASH
2008 Oct 14 20:04 Tue 2454754.336
2008 Nov 13 06:19 Thu 2454783.763


-t

[tangent4ronpaul]

[url]
http://www.traders-talk.com/mb2/inde...&mode=threaded

You cut and paste a truncated link. Do you have a working link?

thanks,

-t

[tangent4ronpaul]

Just for giggles... kind of looks like it was hot and we were being bombarded with a lot of solar radiation during prior crashes. If there is anything to the correlation, we aren't due for one.



-t

[raiha]

Get back to you in the weekend to try and fix the links. Zippyjuan...i am impressed with your hard work even if it does not fit the theory. Will look properly in w/e. There is an astrology link in the Kitco forum on Bar and Grill where i've been imbibing all this:https://www.kitcomm.com/showthread.php?t=43375

[eduardo89]

Sounds to me like men invest there money around the new moon (when women are generally on their periods) and then cash out and spend it around the full moon (when women are generally more available, ovulating and horny)

That is a pretty good theory...would make sense, that's when we need to cash to lure them into bed!