Mercury Retrograde has a bad reputation.
Along with personal Sun-sign horoscopes, the Mercury Retrograde phenomenon is one of the best-known astrological concepts. It’s the time when, as seen from the Earth’s perspective, Mercury seems to move backwards in the sky. Many people with little knowledge of astrology are aware that Mercury Retrograde periods are significant; most have also learned that when Mercury is retrograde, they can expect the worst.
Things go wrong when Mercury is retrograde. Mercury Retrograde periods coincide with major challenges in travel and transportation, in computers and technology, in contracts and commercial transactions, and in all sorts of communication– from one-on-one conversations and personal relationships to publications, email, and websites.
Traders are especially vulnerable to Mercury Retrograde periods. Mercury goes retrograde three times each year, and each time it stays retrograde for about three weeks. For many traders, those occasions are riddled with missed opportunities, misinterpreted market signals, and botched order executions. It’s not unusual to see our trading performance sag significantly then.
No Need To Be A Victim
But instead of allowing ourselves to become victims of Mercury Retrograde, we can use those occasions in intelligent ways that can actually improve our trading results. One of the greatest benefits of astro-trading is that it helps us identify critical periods in advance, and then use that foreknowledge for an extra edge in the markets.
In 2013 Mercury is retrograde from February 23 through March 17, from June 26 through July 20, and from October 21 through November 10. On each of those occasions, astro-traders have an opportunity to use empirical data about the real results of Mercury Retrograde periods to position themselves for more effective trades.
Because Mercury goes retrograde so frequently, we have lots of data available on what actually happens in the markets when this phenomenon occurs. Much of that information, including insights on individual equities, precious metals, and market indices around the world, has been compiled in the book Mercury, Money and the Markets (available from Amazon.com).
To get the most from the empirical data, however, we need to dispel some of the biggest misunderstandings about Mercury Retrograde and the markets. The fact is, Mercury Retrograde doesn’t always impact the markets in the negative ways that its bad reputation in popular astrology might lead us to expect.
Here are some of the most common myths about trading with Mercury Retrograde:
Myth #1: Mercury Retrograde drives all stock prices down.
It’s common to hear astro-traders say “Of course that stock I bought just tanked. After all, Mercury is retrograde, so what do you expect?”
Actually, however, not all stocks do a nose-dive when Mercury is retrograde. Of course there are some stocks that do decline during Mercury Retrograde periods; Bank of America Corporation (NYSE – BAC), for example, typically drops by nearly 3% during that time. But many other issues typically go up in price when Mercury is retrograde. Others essentially trade flat, ending up at the conclusion of the retrograde period at basically the same price that they were trading at when the retrograde began.
That’s why it’s so important for us to base our astro-trading decisions on rigorous back-testing of historical price data. When we see how a stock or a commodity has performed during previous Mercury Retrograde occasions, we have no guarantee that it will perform in the same way the next time Mercury goes retrograde. But at least we know if we have the odds in our favor, and thus make better-informed trading decisions.
Myth #2: It’s best to avoid trading completely while Mercury is retrograde.
While trading when Mercury is retrograde can definitely be tricky, the difficulties don’t justify abandoning the markets altogether. That’s especially true if you’re actively trading, and doubly true if your livelihood depends upon your trading success.
After all, Mercury is retrograde about 18% of the time each year, and most active traders can’t take that much vacation time! While you could choose to abstain from trading during Mercury Retrograde, it’s more profitable to stay engaged in the markets then, provided you base your trading decisions on careful analysis that takes Mercury Retrograde into account.
While Mercury is retrograde, however, it’s critical to be more cautious in your trading. Don’t ignore your trading rules. Double-check your trades before you click the mouse and commit to a new position, to avoid placing an order for 10,000 shares when you meant 100, or putting in a short sale when you meant to go long. Some extra care can help make Mercury Retrograde much more profitable!
Myth #3: Some market sectors do worse than others when Mercury is retrograde.
Because Mercury is associated with communications and technology, some astro-traders expect those market sectors to behave in uniform ways when Mercury goes into retrograde motion. But that’s not the case. Verizon Communications Inc. (NYSE – VZ), for example, typically drops by about 1.1% when Mercury is retrograde, but Cisco Systems, Inc. (NASDAQ – CSCO) typically gains about 1.6% during the same periods.
See Figure 1 below: Verizon Communications (VZ) typically declines in price when Mercury is retrograde. During 2012 its losses were a little more than 2% each time Mercury reversed direction.
See Figure 2.
Cisco Systems (CSCO) had an exceptionally strong track record during the times that Mercury was retrograde in 2012. The price of this stock usually goes up during such periods, but its gains in 2012 were higher than the norm.
Our research shows that even though Mercury Retrograde has a variety of effects, there aren’t clear patterns of influence on specific market sectors. It’s much more profitable to look at trading vehicles on a case-by-case basis, to discover the most probable outcomes for individual trades.
Myth #4: Mercury Retrograde makes market action too unpredictable for successful trading.
It’s true that accurate market forecasting can be challenging while Mercury is retrograde. But when we know exactly how a particular market has behaved in the past, we can use that information to take appropriate positions now. Trading is always about evaluating probabilities in seemingly unpredictable situations, and Mercury Retrograde periods are no exception.
Myth #5: Mercury Retrograde affects all traders in the same way.
The impact of Mercury Retrograde on trading performance differs from individual to individual, and those differences are reflected in the natal horoscopes of the individuals. If you’re serious about astro-trading, it’s essential to work with an experienced financial astrologer in understanding your personal horoscope, so you can maximize your trading potential and avoid self-sabotage in the markets.
What To Do Next
Once you’ve gotten the Mercury Retrograde myths out of the way, your task as an astro-trader is straightforward: back-test the trades you are considering.
You’ll find a complete listing of all the Mercury Retrograde periods for the years 1900 through 2100 in Mercury, Money and the Markets. By studying the performance of a stock or commodity during the previous times that Mercury went retrograde, you can assess the likelihood of its price movement during the next Mercury Retrograde.
Yes, Mercury Retrograde does have a bad reputation. But once you get to know it a little bit better, you’ll discover that it’s really one of the astro-trader’s best friends!
