Energy Flow Theory & Financial Markets | Al Larson

As planets orbit the sun, they exert tidal forces upon the gases of the sun. These tidal forces cause swirling motions on the sun, creating sun spots, solar flares, coronal holes, and other energy events. All these effects combine to vary the amount of radiation that leaves the sun. That solar radiation is our sole source of energy. We are subject to every fluctuation in it. Solar radiation travels to the earth in two ways: as direct radiation, such as sunshine and radio waves, and as charged particles carried by the solar wind. This flow of charged particles forms a torrent of energy that blasts earth creating a bow wave and a wake, just as a boat going upstream would do. This bow shockwave forms a magnetopause between the earth and the sun. It interacts with the earth’s electromagnetic field, shaping and adding energy to it. At the poles, charged particles follow the magnetic lines of force into our atmosphere. This creates a charged layer called the ionosphere.

As this solar wind passes earth, it shapes our magnetosphere into a teardrop shaped envelope of trapped charged particles. As solar radiation varies so does the earth’s magnetic field, atmospheric ionization, and temperature. Scientists have tracked down a host of relationships between these events and a variety of earthly phenomena such as weather, climate, crime rates, plant growth rates, frequency of thunder storms, blood Ph levels, psychiatric emergencies, and many others.

As part of this activity the solar wind charges our ionosphere to a voltage of approximately +300,000 volts. This charged layer above the earth represents the positive end of a battery. When you stand on the ground you are standing on the negative end of this battery. This is the earth’s electric field that we all live in. When you stand erect, it places a voltage on the top of your head of about 240 volts. That is the same voltage as used by your oven element. Fortunately for us, this is not a high current power source. Otherwise, we would fry.

 

 

 

We are affected by this field. This voltage causes currents to flow through us as we live on earth. These currents are approximately 2000 times as strong as the biological currents that run our brain, our nervous system, our muscles, and our organs. All of our body’s electro-chemical systems are subject to the fluctuations in these currents. The ionosphere and the charges on it form a very dynamic system. Events such as solar flares can cause rapid and large changes in this voltage. Our biological circuits feel these changes. These changes can affect all our biological processes including our emotional moods. Scientific studies have shown that changes in ionization cause people to feel giddy to gloomy. These moods show up in the markets. It is well accepted that markets move in response to fundamental forces and investor psychology. A major finding of my work is that investor psychology is driven by the physical energy system. Those emotional rallies and declines are controlled by the currents that run through us. We call those currents emotions.

[...] I have related the timing and price level of market turns to these currents. I have exhaustively verified every link in this chain of cause and effect. I have developed a solid mathematical knowledge of how this energy flow controls pattern, price, and time in markets. While it is not possible in a chaotic system to make perfect predictions, I have been able to formulate a computer program called XGO which predicts markets with between 60% and 90% accuracy […] This S&P forecast has been running about 80% accurate over the past two months. It was computed over one year ago, and used no price data! It is simply a computation of the energy coming into the S&P. These forecasts can be made for any market, for any time in the future. This is a unique scientific technology.

Quoted from:
Al Larson (1997) – Energy Flow Theory.

See also:

Hans Hannula ( 1987) - In Search of the Cause of Cycles.

Hans Hannula (1991) - A Lunar Chaos Theory.

Al Larson (1997) - Your Electric Life.

Al Larson (2001) - The Sun and the S&P 500.
Al Larson - www.moneytide.com

DrAlLarson - YouTube Channel.

TPR - Financial Markets and Solar Activity.

L.H. Weston - Gann’s Professor | Hans Hannula

I've been told that Gann was very private about his office. He absolutely forbid anyone from entering it. He wanted to protect his secrets. But one document he kept in his safe. That document was a manuscript by Professor Weston of Washington, D. C. It was written in 1921 (part 1) and 1923 (part 2), four to six years before Gann published his Tunnel Thru the Air, Or Looking Back From 1940, Tunnel Thru the Air contains, in coded form, Gann’s explanation of how to use planetary cycles to trade stocks and commodities. 

 

He told his own family that it was all they ever needed to learn his market secrets. Many Gann students have labored very long and hard (yes, me, too) to decode Gann's writing. Gann loved to write in the abstract style of the Biblical mystics, whom he admired. Much of what is written in the Bible is information about planetary cycles. It is hidden in census counts, symbolic imagery, and heavily coded to escape notice of the casual reader. While one can dig out this material, it takes time, an ephemeris, and a lot of work. Gann had it much easier. What you are about to read is the paper Gann kept in his safe. 

 

Take your time and read it carefully. It’s one of the best papers ever written on the market. 

After you read it, I'll point out some interesting things about it.

 

HERE

 

[...] First, this is clearly the foundation of Gann’s use of the 10 year cycle, and its multiples. Second, this is historically a fairly early use of Fourier sequences, and far more mathematical than just using financial astrology. This is no surprise, since it is well known that Gann was a very good mathematician. It is also a source of many of his ideas that market movements follow geometric rules.

 

[...] It is also quite interesting that Weston actually proposed two different versions of the ten year pattern. The first is his computation, using 50 years of data, of a series composed of 20 , 28, 10, and 14 month components, to which he adds a Venus term. In this system he cites use of heliocentric positions. We'll call this first method "Weston’s Curve’.

A most interesting point made in this method is Weston’s discovery that the planetary cycles tend to slip to synchronize with the earth’s annual cycle. I discovered this in my own work, and was sure it was an original discovery. So much for that vanity!

The second method I call “Weston’s Snowflake.” In it he proposes a sequence of turning points in the Jupiter-Saturn cycle that divides it into 10 irregular parts. Interestingly, Weston claims that this is a geocentric system. We'll show in a moment that it was not. But this “false lead” may have been intended for those whom Weston feared would learn his secret. Gann obviously made good use of Weston’s methods.  

[... Weston used] the 0, 18, 54, 90, 126, and 180 degree points of the Jupiter-Saturn cycle as turns. One can quickly see the problem with using this geocentrically. Almost all of the points are triple points, as the earth moves around the sun, giving multiple views from which to measure the angle between Jupiter and Saturn. The problem becomes one of which points to use.

[...] It took only one look at using this rule heliocentrically to convince me that Weston used it that way. Obviously, W. D. Gann watched these outer configurations to be alert for the deviations they might cause in the Jupiter-Saturn cycle. You are advised to do the same.

Quoted from:
Hans Hannula (1993) - Gann's Greatest Secret.

See also:
L.H. Weston (1921 & 1923) - Being a Treatise on the Geometrical or Chart System of Forecasting in which is explained the principles of the art, and, in this lesson no. 1, giving demonstration with the price curve of potatoes in U.S. 

Financial Markets & Seasonal Geomagnetic Field Variation | Hans Hannula

Any grade-school pupil can tell you when the seasons begin. In the northern hemisphere, generally, spring begins March 21, while summer begins June 21. Autumn begins September 23, and winter begins December 21. Actual dates may vary by one day in a particular year. So step one is simple.

The physical reason behind the seasonal cycle is the tilt of the Earth's axis. The 23.5-degree tilt of the Earth's axis causes more direct heating of the northern hemisphere in the summer, when the Earth tilts toward the sun. It causes less heating in the winter, when the Earth tilts away from the sun. This change in heating and cooling causes the seasonal weather patterns that we are familiar with.

 

Charged particles from the sun form a teardrop-shaped envelope about the globe called the magnetosphere.

Not so well known is the effect of the seasonal variation on the Earth's geomagnetic field. As the sun emits energy, charged particles flow outward, carried by the solar wind. As these particles sweep past Earth, they form a teardrop-shaped envelope around the globe called the magnetosphere.

There is a seasonal variation in two important parts of the magnetosphere. When the Earth tilts toward the sun in the summer, the charged particles can more directly flow into the north pole, where they affect the Earth's magnetic field. This effect is lessened when the Earth tilts away from the sun in the winter.

The second magnetic effect is on the magneto-tail, that part of the magnetosphere which streams away from the sunny side of the Earth. As the Earth tilts toward the sun, this tail "rides higher." As the Earth tilts away from the sun, the tail "rides lower." This affects how our moon, which moves in and out of the magnetosphere, interacts with the Earth's magnetic field.

Australian Government Bureau of Meteorology (2023):
The Seasonal Distribution of Geomagnetic Disturbances.

So what does this have to do with stocks and commodities? Scientific evidence suggests that these fluctuations in the Earth's magnetic field affect humans. Studies show that magnetic field changes are linked to blood PH changes, which in turn cause mood swings. Perhaps the psychological mood swings of traders are also subject to these magnetic field changes.

More obviously, the seasonal cycle could be expected to affect crop prices, such as those of wheat, corn and other commodities. Similarly, with most businesses running on a quarterly profit cycle, seasonal variations in the buying and selling of materials and equipment can be expected. Thus, on both a fundamental and technical basis, a trader can expect season price variations in stocks and commodities.

To perform step 2, mark the dates of the cycle on a chart with solid dots, and place them above or below the price as you estimate that price is high or low relative to what it was approximately one-fourth cycle earlier. Points do not necessarily have to alternate between high and low.

Now look for cycle "inversions." If two lows or highs occur in succession, the cycle has "inverted" between the points. A normal inversion point is halfway through the cycle.

Quoted from:
Hans Hannula (1991) - The Seasonal Cycle. In: Stocks & Commodities V. 9:11 (458-460).

 

See also:
Tianbao Zhou, Xinghao Li & Peng Wang (2021) - Chinese Stock Indices, Gann Time Theory & Solar Terms.

Chinese 24 Solar Terms for 2023.

 

 

CNN Business - Fear & Greed Index as of June 16, 2023.

Lunar Chaos Cycle | Al Larson

Al Larson (1991) - Basic Physical Mechanisms: Development of a physical theory of cycles begins with an examination of the solar systems construction. It is composed of ten very important chunks of rock that orbit a ball of burning gas, the sun. The nine planets and our moon are the big rocks. For eons, these rocks have proceeded relentlessly on their courses, carefully balancing the forces they exert on each other and on the sun, and vice versa.

 "Fully 76% of the Venus events coincided with highs and lows,
as did 84% of the Mercury events."

 

To date, two mechanisms have been proposed that could explain the effects of this system on earthly events. Theodor Landscheidt has presented many correlations between the solar system's center of mass and the outburst of solar flares. His theory states that, as the planets rotate, they shift the center of mass of the combined planet/sun system around. Al times, this center of mass actually moves outside the surface of the sun. As it passes the sun's surface, a chaotic boundary condition exists, resulting in outbursts of large solar fares [...] As the planets orbit the sun, they exert tidal forces on the sun's gases, much as the moon raises tides on the earth [...]  Jupiter, Mercury, Venus, Earth, Mars, and Saturn are the most influential, in that order. These gas swirls cause a number of solar effects, including sunspots, coronal holes, and solar flares. All these effects combine to vary the amount of radiation that leaves the sun. This solar radiation is carried toward the earth in two ways: 

1. as direct radiation, such as sunshine and radio-waves, and 
2. as particles carried by the solar wind. This flow of charged particles forms a torrent of energy that blasts spaceship earth, creating n bow wave and a wake, just as a boat going upstream would do.

This bow wave forms a magnetopause between the Earth and the Sun, and interacts with the earth’s magnetic field, both shaping it and adding energy to it. At the north and south poles, the charged particles follow the magnetic lines of force, and enter our atmosphere in what is called a Polar Cap Absorption Event. This leads to the auroral oval, producing our Northern and Southern Lights.

The bow wave also creates an envelope about the earth, called the magnetosphere. As the solar wind flows past the earth, the magnetosphere forms a teardrop-shaped envelope of trapped particles that ends in what is called the magnetotail. It is inside this envelope that the moon orbits.

As the solar radiation varies, so does the earth's magnetic field, atmospheric ionization, and temperature. Scientists have tracked down a host of relationships between these events and a variety of earthly phenomena such as climate, weather, crime rates, plant growth rates, frequency of thunderstorms, blood PH levels, psychiatric emergencies, etc. My own work has related these events to market action as well. I believe a third mechanism that involves the moon also is at work . 

 

A Theory of Lunar Chaos: I believe I have discovered another lunar cycle, which I call the “lunar chaos cycle.” My theory is that, as the moon rides high and low and moves closer and further from the earth, it crosses the boundary between the ionized particles trapped in the moon's wake and the fast-flowing solar wind. The figure at left shows boundary crossings at two full-moon positions (1 and 2) and two new-moon positions (3 and 4). Such boundary crossings would lead to sharp disturbances in the earth's magnetic eld, which would affect those of us who live within it. A further perturbation can be theorized, as well- the perturbation of the nearby planets, Mercury and Venus. When the moon's balanced on the edge of the magnetopause, a chaotic balance point exists. Either interior planet can tug the moon into the solar wind, tipping the balance just as Lorenz's Butterfly Effect tips the balance in weather patterns.

A Simple Mathematical Model: To test this theory, I created a simple mathematical model. This model computes the degree of exact alignment of a planet (either Mercury or Venus) with the Earth and Moon, and when the Moon is above or below 3° inclination. This yields a lunar chaos input function for each planet [see chart above].