Eclipses have been considered an omen of things to come from the earliest days of mankind. Many traders still consider eclipses to be signiﬁcant for the stock market while others ignore them completely. A great deal of confusion is generated on this subject, especially after the apparent failure of the widely advertised July 11, 1991 solar eclipse to have an effect on the market.
What do eclipses really mean for the stock market? First let’s start with the basics. Eclipses are a common occurrence of about four to seven each year. There are two kinds of eclipses: solar and lunar. The solar eclipse is a new moon where the moon’s orbit blocks the light from the sun. A lunar eclipse is a full moon where the moon passes through the earth’s shadow.
Solar eclipses can be broken down into three different types. Total solar eclipses have complete sun coverage. Annular eclipses are total except for a ring of light surrounding the disk of the sun. Finally, with partial eclipses the moon only covers part of the sun.
Lunar eclipses also have three different types. In a total lunar eclipse the moon falls completely in the shadow of the earth and-disappears from view. In a penumbral lunar eclipse the moon falls into the area of partial shadow called the penumbra. A partial eclipse occurs when only a portion of the moon is covered by the earth’s shadow.
Our study covers 141 solar eclipses and 143 lunar eclipses from 1929 to the present. Daily charts of the Dow Industrials were studied looking for an eclipse effect. For the purpose of this article we deﬁne “eclipse effect” as either:
- A deﬁnite trend change (not just a small one day trend change) within 2 days of the eclipse.
- A very signiﬁcant trend change (monthly or longer) within 3 days of the eclipse.
- A very volatile outside day within one day of the eclipse.
Of the 141 solar eclipses studied there were: 49 total, 47 annular and 45 partial. An eclipse effect was noted for 37 out of 49 total eclipses or 75%.
The 37 eclipse effects were almost equally divided between highs and lows for total eclipses. (17 highs and 20 lows). For annular eclipses, 32 out of 47 were significant or 68% of the time. For partial solar eclipses only 23 out of 45 eclipses or 51% coincided with an eclipse effect.
As expected partial solar eclipses were the weakest, exactly as one would expect. Some interesting solar elipses: 3/7/32 high for the year; 5/30/46 – high for the year; 5/20/47 low of the year; 10/23/57 – low of the year.
Of the 143 lunar eclipses studied there were 51 total, 53 penumbral and 39 partial. An eclipse effect was noted for 115 or 80%. For total lunar eclipses, 39 out of 51 were signiﬁcant or 76%. For partial eclipses, 32 out of 39 were signiﬁcant or 82%. For penral it was 44 out of 53 or 83%.
These results were surprising in two different ways. First, total lunar eclipses were not as strong as penumbral or partial. However the few percentage points difference between them is probably not statically signiﬁcant. It was also surprising that lunar eclipses had a more consistent effect. Many people consider solar eclipses to be more important but only 92 of the 141 solar eclipses or 65% were signiﬁcant.
Notable lunar eclipses: a) 7/26/34 low for the year. b) 11/7/38 – 2 trading days from the high of the year. c) 2/9/44 – 2 trading days from the low of the year. d) 9/15/51 – high of the year.
Eclipses have been associated with “crash” behavior in the markets but from our research that is not the case unless the eclipse is negatively aspected by an outer planet. On Sunday, March 29, 1987 the solar eclipse formed a near exact 90 degree square angle with the planet Neptune. On Monday, March 30 the market was down 57 points. Another example of crash behavior was associated with the June 15, 1973 lunar eclipse. The moon was at a bearish 180 degree opposition to the planet Saturn. The Dow was down 14.37 points or a steep 1.6% drop from the 900 level. The next eclipse to watch for crash behavior is the solar eclipse of May 21, 1993. This eclipse forms a bearish 90 degree angle to the planet Saturn. Watch out for this one!
For reference purposes next year’s eclipses and their anticipated effects are displayed in table 1.The material presented in this article is for research purposes only and does not make any buy or sell recommendations. The past application of this technique does not guarantee its continued success in the future.
- The Power of Eclipses and Their Effects on the Market By David Wierzba