SIDC: The daily (yellow), monthly (blue) and monthly smoothed (red) sunspot
numbers since 1994, together with predictions for 12 months ahead: SM (red dots) : classical prediction method, based on an interpolation of Waldmeier's standard curves; CM
(red dashes) : combined method (due to K. Denkmayr), a regression
technique coupling a dynamo-based estimator with Waldmeier's idea of
standard curves. Peak: January 2013
NASA: The current prediction for Sunspot
Cycle 24 gives a smoothed sunspot number maximum of about 59 in early
2013. We are currently over three years into Cycle 24. The current
predicted size makes this the smallest sunspot cycle in about 100 years. Peak: January-February 2013
IPS: Peak: December 2012
Last updated 26 Mar 2012 13:03 UT
FORECAST SOLAR CYCLE 24
-------------------------------------------------------------------------------
Cycle Sol. Start Sol. Max Max SSN Length Rise to Max Max to End
Year Mth Year Mth Yr Mth Years Mths Years Mths
-------------------------------------------------------------------------------
24 2009 Jan 2012 Dec 90.2 11.0 132 3.9 47 7.1 86
IPS will adjust this forecast cycle as the new cycle unfolds.
The difficulty is ensuring that adjustments are not made for short
term variation, only for longer term cycle variation.
NOAA: Given the predicted date of solar minimum and the predicted maximum
intensity, solar maximum is now expected to occur in May 2013.
Here is the data supporting the shorter term strategy of buying at
solar minimums and selling at the next cycle maximum for an average 70%
gain:
Why might stocks consistently outperform in these periods from solar
minimum to maximum, and underperform from solar peak down to the next
solar minimum, particularly as higher solar activity can cause higher
geomagnetism on Earth which affects humans biologically negatively and
adversely affects stock market returns?
Well,
there is a slight lag in geomagnetic peaks after solar cycle peaks, as
shown below, and this fits well with why we have seen an economic
recession follow each solar cycle maximum in the last century - it
corresponds to the peak in geomagnetism. Historically, this
post-solar-peak period has been one of human apathy and peace.
Conversely, the period into the solar peak has been one of human
excitability, pro-action and economic inflation, which fits well with
stock market gains.
 |
| Source: Susan Macmillan, British Geological Survey |
Solar Cycle 24 began around December 2008 with a solar minimum and it
is predicted to peak in July 2013. An average gain of 70% for the Dow
over this period would translate as 14500 by mid 2013 (which would mean a
new nominal all time high).A recession has closely followed
solar peaks for each solar cycle in the last 100 years. The average
recession duration is 1 year. The average length of recession-induced
stocks bear markets is 1 year 4 months. As the stock market is forward
looking, and a leading indicator, we could therefore find the the stock
market peaks around the beginning of 2013 and then declines into the
solar peak in mid 2013, and then declines through a recession into 2014.
Dow-Commodities
ratios and consumer price inflation should peak at extremes at the
solar peak (as has occurred each time in the last century), suggesting
commodities should push on all the way into mid-2013 whilst stocks lag
in the last few months.
In summary, there is a correlation between
stock market performance and solar cycles. A profitable strategy over
the last century would have been to buy at the solar minimum and sell at
the next solar maximum, and repeat for an average 70% gain in each
instance.
An even more profitable strategy would have been to buy
and hold over 2-3 decades in between 3 specific half solar cycles. This
strategy would have produced 10-fold gains each time, and pattern
continuation suggests such a repetition from the solar minimum at the
end of 2008 looking out to the 2030s, in line with a further secular
stocks bull.
Looking shorter term to the solar peak around
mid-2013, stocks should track yet higher, and this implies commodities
much higher, as an extreme relative pricing of commodities over stocks
should be reached around that solar peak, before a secular inversion.
John Hampson, April 2011 @ www.marketoracle.co.uk/Article27341.html
