MOON - SUN PARALLELS:
THE GREAT PANICS OF 1929 & 1987

David McMinn

Moon - Sun Finance

The 1929 & 1987 were the most dramatic stock market panics in US history and numerous books and papers have been written on these events. However, the astonishing Moon - Sun parallels for these two events have been completely overlooked in traditional economics. These cyclic similarities are truly remarkable and will be covered in the following text.     

Please note: The annual one day (AOD) movements were the biggest one day % rise or fall in the Dow Jones Industrial Average (DJIA) in the year beginning March 1. Major AOD rises and falls were found to be highly significant in relation to lunar phase and the ecliptical positions of the Moon and Sun (McMinn, 2006). A glossary has been included for those not familiar with the terms used in this paper.
 
Moon - Sun Parallels         

Intervals of precisely 717.0 synodic months appeared between the pre crash spring lows, the record highs, the October highs, the black days and the AOD rises (McMinn, 2006; Carolan, 1992, 1998). Post crash, the interval of 718 synodic months appeared with the bear market lows, the 1930/1988 spring lows and the 1931/1989 AOD falls. The need to add or subtract integral and half integral numbers of synodic months is a key finding from the research so far undertaken by McMinn (2006). Why this is necessary remains unknown. These 717 & 718 synodic month intervals equal a Double Inex eclipse cycle (716) plus 1.0 or 2.0 synodic months.
         

  

Curiously, the record high of July 16, 1990 occurred 717.63 synodic months after the secular low of July 8, 1932 and thus aligning approximately within this 717-718 synodic month cycle.  

The Hong Kong stock market declined 11.1% on October 19, 1987 and closed the following day in view of the 22.6% DJIA fall on Black Monday. The Hong Kong authorities, in their infinite wisdom, reopened the market on October 26 and the Hang Seng dropped 33.1%. Cyclically, the timing was appalling. It was the worst possible day to reopen the market, given the trends in the 1929 crash and the major fall on November 6 (see Table 1).

There were also notable alignments of one day (OD) % falls during the 1929 and 1987 panics. This was illustrated in Table 2, which was based on all OD falls =>3.00%. The interval of separation was consistently 717.0 synodic months during the period late September through to early November. Something similar could not be repeated for OD % rises, even though the AOD rises on October 30, 1929 and September 21, 1987 were separated by 717.0 synodic months. The falls on November 11, 12 & 13 took place near the bear market low on November 13. Likewise, the bear market low on December 4, 1987 was preceded by notable falls on November 30 and December 3.

In % terms, the two major OD falls in 1929 - October 28 (-12.8%) & October 29 (-11.7%) - approximately equalled the AOD fall on October 19, 1987 (22.6%). Similarly, the two days immediately post 1929 and 1987 crashes recorded comparable % rises in the DJIA: October 30, 1929 (12.3%) & October 31, 1929 (5.8%) and October 20, 1987 (5.9%) & October 21, 1987 (10.1%).

The 1929 & 1987 panics were so similar, in part because Moon – Sun cyclic intervals between the two events were all in integral numbers for the synodic month, the tropical month/year & the nodical month/year (to within minus 0.03 to plus 0.11), while the apogee month was in a half integral number. Such an alignment between major financial panics was a rare event. 

The October 1997 Panic

For the October 27, 1997 US panic, a less perfect outcome was achieved for the intervals (peak, panic & AOD rise) with the 1929 or 1987 panics. These synodic month intervals occurred in close integral numbers to within minus 0.03 to plus 0.11.

The 1929 & 1987 October black days took place two tropical months after the record peak, while the comparable interval for the 1997 event was exactly three tropical months. 

The 1929 & 1997 post crash lows happened 0.5 synodic months after the panic day, where as the comparable interval for 1987 1.5 synodic months.   

The intervals between the 1929, 1987 & 1997 October panics gave an inverse Phi ratio and Fibonacci - Lucas numbers. 

*    10 divided by 68 = 0.147 (1/Phi⁴), while 58 divided by 68 =  0.853 (1 - 1/Phi⁴ ).

*    58 divided by 2 = 29 (Lucas number). 68 & 10 divided by 2 = 34 & 5 respectively (Fibonacci numbers).

Lucas numbers are often linked by the addition of two Fibonacci numbers

However. Lucas numbers can also arise by subtracting one Fibonacci number from another (see below). The intervals between the 1929 - 1987 - 1997 October panics were based on (34 - 5 = 29) x 2 which is the same as (29 + 5 = 34) x 2.

Conclusions

The Moon – Sun parallels between the 1929 and 1987 great panics were truly remarkable and it seems strange that such similarities have not been commented upon in academia. The difficulty arises to explain how these parallels arise and why the importance of 717 and 718 synodic months between the various key market turning points in 1929 and 1987. Moon - Sun effects are strongly evident in financial patterns and these give rise to mathematical structures. Unfortunately, only glimpses may be gleaned on how Moon – Sun cycles actually work and no overall picture can be deciphered at present.      

©  Copyright. 2004-06. David McMinn. All rights reserved.

References

Carolan, Christopher. The Spiral Calendar. New Classics Library. 1992. 
Carolan, Christopher. Autumn Panics. The Market Technician. Journal of the Society of Technical Analysts. p 12. July 1998.       
McMinn, David. Market Timing By The Moon & The Sun. Twin Palms Publishing. 2002. Revised 2006.