Water Horse year: 2002 annual forecast.
For the last two years, we have correctly predicted the decline in the stock
markets, based on Chinese astrology (
Meanwhile we have done a more detailed study based on 200 years of stock data.
We will use this research to shed some light on the year to come.
Studying the 200 years of data we noticed that there tend to be 'strong'
decades, during which stocks rise strongly, and 'weak' decades when stocks
remain flat or go down.
Comparing the average yearly performance (S&P) in good and bad decades, we
We notice that, both in strong and weak decades, the Yin Wood (xxx5) and the
Yang Earth (xxx8) years tend to show the best performance.
We also see that in weak decades it is especially the Yang Wood (xxx4) year
that tends to disappoint : instead of rising strongly we get a decline.
We could compare this to agriculture : if the growing season (= Wood) fails or
starts too late, the harvest is going to be below average ( = the decade will
Given the 2 very good decades that preceded (1980 - 1999), and the decline we
have seen so far in this decade, it is more likely that we are in for a weak
That means we probably better take the blue curve (see picture) as a guide for
The Yang Water (xxx2) years tend to be flat on average during weak decades,
that means they can go either way.
So, we expect the market to be in consolidation mode (moving sideways) for most
of 2002, before drifting lower again in 2003 and 2004.
That would also fit in very well with what we learn from the updated long term
With the Metal months just behind us, we look for upward bias in the markets at
least until May, possibly until September. Then we have Metal months again in
October and November, so we will go on crash alert if the market has held up so
The current Nasdaq short term outlook shows it in a nutshell:
So, we expect the market to be slightly up by mid year, but slightly down by
the end of 2002.
Any changes in this outlook will be discussed in the free
Disclaimer: Investing in stocks is risky. No guarantee can be given that the
above prediction will be correct. Fourpillars.net cannot in any way be
responsible for eventual losses you may incur if you trade based on the
information given in this article.
Hypothetical or simulated performance results have certain inherent
limitations. Unlike an actual performance record, simulated results do not
represent actual trading. Also, since the trades have not actually been
executed, the results may have under- or over-compensated for the impact, if
any, of certain market factors, such as lack of liquidity. Simulated trading
programs in general are also subject to the fact that they are designed with
the benefit of hindsight. No representation is being made that any account
will or is likely to achieve profits or losses similar to those shown.
This information should not be considered as a recommendation to engage in
the purchase and/or sale of any futures contract and/or options. Trade at
your own risk.