A computerized system that measures the psychological impact of transiting planets on the human psyche is described by its creator as having “just progressed to the Model T Ford stage.” Even so, the mathematically-based system, which selectively calculates and assigns positive or negative values to the changing angular distances between orbiting planets, is at this point accurate enough to predict the mood swings driving directional shifts in global stock prices — up and down. And this, says technical market analyst Richard F. Schulz, “just begins to tap its long-range potential.”

The system he calls the Technical Aspect Oscillator (TAO) is described in the April/May issue of The Mountain Astrologer magazine. It is designed to scientifically measure and predict the impact of orbiting planets on investor sentiment and, by extension, price moves in the marketplace. Schulz says continual tracking has revealed close statistical correlations between the global psychological indications predicted by the technology and bullish and bearish stock market sentiment. There’s less than a one in 10,000 probability that the observed correlations occurred by chance.

“The research supports the astrological premise in two important ways. It confirms that the various archetypal energies astrologers have traditionally identified with the orbiting planets can be rigorously observed impacting human affairs. And it confirms that changing planetary alignments or patterns predictably influence outcomes in measurable ways,” he noted.

Modern astrologers believe that archetypal energies associated with transiting planets are both distinctive and dualistic in nature. For example, Saturn is positively identified with such qualities as stability and sound philosophical judgment and negatively with fear, separation, restriction and physical limitations. Jupiter represents the principle of expansion, optimism and success, but is negatively identified with extravagance, inflation, excessive overconfidence and the like. In a similar vein, Martian energy is positively identified with action and initiative and negatively with anger and frustration, Schulz said.

Changing Angular Relationships

“For centuries, astrologers also have claimed that the changing angular relationships between orbiting planets powerfully impact events on earth. Whether the various planetary archetypes will be expressed positively or negatively largely depends upon the way they are aligned with each other at any given time,” he explained.

As viewed from the earth, orbiting planets appear to be moving at different speeds. The reason for this is because some planets are a lot farther from the sun than others and have move celestial distance to cover in their elliptical orbits. As a result, faster moving planets (including the sun and moon) appear to continually overtake slower moving planets, forming what astrologer’s call applying and separating “aspects” as part of predictable cycles. Because the mathematics of celestial mechanics are well understood, astronomers and astrologers can quickly determine precisely where in the heavens the sun, moon and every known planet in the solar system can be found. Also known is the exact number of astronomical degrees separating the planets as they travel through the various zodiacal signs.

Some aspects between planetary pairs are deemed to be stressful while others promote harmony and ease. For example, planets forming aspects of 60 and 120 degrees (the sextile and trine) are believed to influence the human psyche in positive or productive ways, while the stressful square and opposition ( 90 and 180 degree) aspects have the opposite affect. Aspects are said to be “in orb” or operative a few degrees before and after the angle is exact. Schulz says the zero-degree conjunction is a powerful aspect that begins and ends the cycle and can be experienced either positively or negatively depending upon the psychological characteristics of the planets involved in the aspect.

“Scientists have ridiculed this idea since the 17th century, arguing that no mechanism exists to plausibly explain how planetary energies could manifest in this way. However, new evidence impressively supports the astrological position,” Schulz maintains. In physics, an oscillator is a measurement between maximum and minimum values. More than two decades of research went into development of the TAO 2 technical aspect oscillator Schulz created to analyze investment sentiment in the financial markets. On a continual basis, the TAO 2 system computes the changing angular relationships between nine different planetary pairs. The planets Saturn, Jupiter and Mars are prominently featured in these pairings.

Moving Average Compared

Schulz says the TAO 2 technology continually calculates a weighted positive or negative value for every degree of angular separation between the planetary pairs. Also compiled is a composite score and moving average that can, over time, be statistically compared with moving averages for the various stock market indexes. Simply, like the market averages, when TAO 2’s average score is rising people’s attitudes and outlook are hypothesized to be more optimistic. Conversely, when the number is falling, pessimism persists.

Because TAO 2 and the various stock market indexes are independent variables with known and constantly changing numerical values, they can be compared with each other using the Pearson product-movement correlation coefficient, a common statistical test used to scientifically determine whether a linear relationship exists. This method creates correlation values (the Pearson r) between -1.000 and +1.000 with r = +0.30 the threshold for statistical significance. In a series of tests conducted between January 1, 1999 and June 30, 2008, the TAO 2’s moving average was compared with the Dow Jones Industrial Average (DJIA) and S&P 500 Index twice a week on Tuesdays and Fridays over the 117-month period — a total of 990 separate comparisons for each index. The correlation value for TAO 2 and the Dow Jones Industrial Average was r= +0.72, which is well above the threshold for statistical significance. A similar comparison with the S&P 500 Index produced an even higher r = +0.81 correlation.

“Correlation is not causation. Stocks can and do move against the TAO 2 average for indeterminate periods of time. But the statistics suggest an extraordinary connection between the aspect oscillator and stock indexes that cannot easily be explained away by astrology’s critics,” he said. Schulz believes the results are difficult to dispute because the technology effectively blends applied mathematics with astronomy in a quantitative numbers-in, numbers-out type system that automatically produces raw scores from data input into mathematical formulae. Subjective human interaction is not involved in any way.

Another test for the TAO technology examines its effectiveness as a stock market timing device. Schulz routinely relies upon the technical analytical tools used by insiders in the business, but doesn‘t make a move in the marketplace without first checking directional indications predicted by the TAO system.

While trillions of dollars in paper assets were vanishing from the stock portfolios of agonized investors around the world, a portfolio of Exchange Traded Funds (ETFs) posted on the www.schulzonmarketcycles.com website between May 5, 2006 and April 1, 2009 were up a robust 395 percent.