Someone won’t believe his eyes when he reads this article about the importance of lunar cycles in financial markets.
I will only talk about the relationship between Moon and markets, leaving out the importance of economic cycles that I will face in other articles. In-depth studies of lunar cycles have been done by one of the best universities in the world, I’m talking about Michigan University which also created a real “index” on lunar phases, these studies allow us to have a very important sentiment indicator.
Lunar phases examined are during the New Moon and Full Moon where a study was done on charts of the most important indices (S&P 500, Nasdaq …) discovering two different realities:
- During New Moon, financial markets are growing, with price highs at times, while there is likely to be a drop or low in Full Moon phases
You will know that moon’s phases affect elements on Earth, I’ll give you a few examples:
- Human behavior (when, for example, a person is told that he is moody, Moon affects pregnancy)
- Magnetic fields (I’m not a physicist but at school I had learned something)
- Atmospheric phenomena (earthquake)
- Agriculture (harvest, sowing)
Lunar cycles have an effect on investor mood, it may seem strange but if you look at the charts you will understand that statistics confirm my words but especially Michigan University’s studies (Alan Greespan during internet bubble collaborated with this university and used that index).
While lunar phases affect investors, stock or commodity prices will also be affected depending on New or Full Moon, asset yields will rise or fall. Personally during my trade i study the market to understand where and when to open position, in my strategy can not miss lunar calendar, it is not 100% sure however it is indicative since statistics unitil now are favorable.
Trading View, Pro Real Time are some platforms that offer the possibility to identify lunar phases on charts, when you trade you have to analyze the period of 15 and 7 days. I did calculations on Excel and compared them with lunar cycles and I did not believe in my eyes, I realized in “demo mode” obviously (I study 3 months a strategy before moving to real money) a profit of 3%.
A further confirmation I had from correlation between lunar cycles and volumes, in fact I noticed a significant increase in volumes as if the investor were in a euphoric state.
It may seem strange but there is a strong correlation between equity returns and lunar cycles, I advise you to pay attention to this peculiarity during your operation and I think you will have a different picture of the situation, hoping it will useful for your trading.