(John Wiley & Sons, Inc., 1996)
Nearly every trader on Wall Street has a system for
beating the market. Some traders verse themselves in the fundamental
of a particular company’s business. They review earnings
reports, balance sheets, interest rates, and other aspects
of business that could affect a company’s stock price.
Other traders rely on the use of charts that illustrate a stock’s
price movement over time. These technical analysts also use
charts to predict the future. Still others use complex quantitative
and statistical models for trading. Finally, the “rocket
scientists” of Wall Street use rather arcane proprietary
methods to help them trade: oscillators, speeds lines, Gann
angles, spirals calendars, Elliott Wavers, or other indicators
of market behaviors.
Then there is Arch Crawford. Arch is a market
newsletter writer who makes his trades based on the position
other astronomical phenomena. A quirky calling to some.
But to Arch, the correlation between the movements of Sun, Moon,
and financial markets is there for all to see, if one only
knows where to look in the cosmos.
From his own description, Arch was a some what
precocious child, always interested in numbers
extracting square roots for fun
in his younger days. One day little Arch saw a page of
numbers in the newspaper that piqued his curiosity. He
was told they
were stock prices and that they went either up or down
from day to day. Most important, he was told that he could make
daily fluctuations in stock prices.
Arch asked incredulously, “You mean I can make
money without working?” He was hooked. (He
has since found out the art of investing does, indeed, take
a lot of work.) So, at the tender age of twelve, Arch Crawford
track of stock prices. He became an avid student of the stock
market, reading Bernard Baruch’s My Own Story. He
also read great tales of moneyed men, like The Robber
Barons and How I Made $2,000,000 in the Stock Market.
mind raced with the possibilities. He began watching
his first stock faithfully every day. He charted the course
of Allegheny Corporation, an amalgam of Depression-era railroads
that had seen its share of troubles in recent years. Arch
tracked the stock, watching it drop to $7. Bounce to $10 or
$11 and hold steady over time. It was building a base for
a big breakout to the upside, Arch surmised, employing the
jargon of a budding technician.
his first purchase of Allegheny at $7 a share. It
promptly went to $4. As they say on Wall Street, if you like
it at seven, you’ll love it at four. So, Arch doubled
up on the stock at $4. After waiting a year for the stock
to skyrocket, Arch had had enough. He sold his entire portion
at $11. He only made a little money, but he was wedded to
the market for life.
Some years later, after finishing high school and
spending a little time in college, he dropped out of the
Carolina and went on to work for Merrill Lynch in Raleigh. There
he furthered his appetite for stock market investing, marking
a chalkboard with fresh stock prices as the ticker tape
came through the office. He became an assistant bookkeeper
eventually made his way to Merrill New York office. It
was in New York where
Arch really learned how to chart the market.
He served as
the first assistant to Robert Farrell, a Wall
Street legend who was among the first chartists to bring
a certain respectability
and intelligence to the field of technical analysis. Along
with men like Edson Gould, Joe Granville, and a few others
ranks among the most prominent chartists Wall Street ever
learned the ins and outs of technical analysis from the revered
Farrell, his insatiable curiosity about a host of
topics was piqued by an article that appeared in The Wall
Street Journal back in 1963. Profiled in the article
was one Lieutenant Commander David Williams, who had written
an exhaustive study of the linking between Wall Street and
the cosmos. It was called AstroEconomics ,
later expanded to Financial Astrology .
Soon after reading that piece of work, Arch discovered a 1940’s
pamphlet entitled Stock Market Prediction,
written by Donald Bradley. The booklet ascribed values to
the degrees of separation in planetary alignment. The values
were related back to the behavior of the stock market.
By this time, Arch too, had coincidentally developed
more than a passing interest in astronomy and astrology. He
describing planetary positions dating back to 1890. As
he became more familiar with the history of the market,
planetary positions and alignments frequently coincided
with certain types of market behavior. Non-threatening
angles coincided with stock market tops. Eclipses, and
of planets, and other more threatening cosmological developments,
often coincided with extreme volatility in stock prices.
These discoveries led Arch to a market method that combined
practice of charting stocks with the less precise science
of charting the stars.
Interestingly enough, today
Arch looks at the statistical correlation between certain
cosmological phenomena and significant market events.
In other words, he doesn’t profess to know why certain
extraterrestrial events lead to market euphoria or distress.
He only knows that they are somehow linked. When Arch sees
a positive astrological development on the horizon, so to
speak, he will buy stocks. When more ominous celestial activity
occurs, he exits the market.
doesn’t profess to know why the stars influence the
street, he does note that the work of John H. Nelson
comes closest to offering a causal relationship between the
swirling of the heavens and the gyrations on Wall Street.
Nelson’s work attempts to show that my looking at the
movements and alignments of the planets one can accurately
predict sunspot activity. At this point, no doubt, your eyes
are starting to glaze over. But, don’t fall asleep yet.
Some cosmological theorists
have speculated that sunspot activity alters human behavior
on earth, causing bouts
of mass euphoria
or anxiety. Some believe that happens because
sunspot activity disrupts the normal electricity in the
field. And that disruption of the ionosphere just might
lead to bouts of collective euphoria or despair, two phenomena
which often visit themselves upon financial markets.
In any event,
it seems that some time, Arch’s cosmological leanings
have left him on terra firma when it comes to the stock market.
He is frequently among the most highly rated market newsletter
writers on Wall Street. He has made some great calls on the
market and he has also been wrong as frequently. [ed.
note: If it was "as frequently", he wouldn't be
"highly rated"] But like the girl with the curl,
when he’s right, he’s very right, as the next
A Little Lunacy. In 1987, the “harmonic convergence” took Wall
Street by storm. This harmonic convergence was a long-awaited
event that brought five of the solar system’s nine
planets into their tightest alignment in over 800 years.
The stock market,
coincidentally or not, hit an all time high on August 25,
1987 at 2722. It would be the highest level the market
before crashing by 1000 points over the next two months.
The market’s vicious decline culminated in a 508
point drop on October 19,1987. That was Black Monday, as
it is now remembered
on Wall Street. The harmonic convergence, a most welcome
event, curiously struck when Wall Street was in the midst
of a collective “High.” The
euphoria peaked as the convergence took place. As Mickey
character once said in the movie Diner, “It’s
recalls that on August 24, 1987, the Sun, Moon, Mercury, Venus
and Mars were in “one third harmonic (triangle) to Jupiter.”
They were locked in the tightest planetary conjunction in
at least 800 years, maybe longer, Arch reckons. According
to Crawford’s star charts, these five bodied will line
up within 5-10 degrees of one another. That happens about
every 396 years. But in 1987, the five orbs were within 2
degrees of one another, an unusually tight conjunction. It
was an event that people the world over gathered to herald.
There were communal rituals from California to Calcutta, as
terrestrial beings communed with the cosmos. It was a period
marked by a collective feeling of enlightenment and happiness.
also marked a peak in the euphoric mood on Wall Street.
Armed with both terrestrial and extraterrestrial trading tools,
Arch knew that the harmonic convergence represented a top
in the stock market. On August 10,1987, Arch penned a prediction
for a publication known as The O-T-C Stock Journal,
a stock market newspaper in which he outlined his bearish
bent, [ed. note: The article appeared on Aug. 24, the DJIA
topped at noon on the 25th] recommending that investors exit
the stock market ahead of an imminent crash. He told investors
to buy treasury bills, gold, and stock index put options,
options that would rise in value if the stock market fell.
He called for the market to top with the advent of the harmonic
convergence and crash shortly thereafter. It did. On October
19th the stock market suffered its worst day in the history
of stock market trading.
It was easy to see
it coming. All one had to do was look up at the sky.