Learn to Trade: Lunar Cycles & the Markets


The moon's effects on our planet have always been shrouded in mystery; however, numerous scientific studies suggest that changes in behavior on Earth are strongly linked to lunar phase changes.

The most glaring evidence is that both lunar cycles and a female's menstrual cycle lasts approximately 28-30 days and it's by no means a mere coincidence. Several studies have tried to quantify the moon's effect on human behavior, with no convincing evidence. Nevertheless, when interferences (stress, illness, fear, etc.) are considered, then the evidence becomes more clear. It's that simple, it's hard to quantify the relationship between lunar phases and human behavior, because humans are so different--we have free will that often seems to negate natural cyclical patterns.

If we examined the relationship between lunar phases and behavior in wildlife, then we should get convincing results. The Association for the Study of Animal Behaviour (1) published a report on the effects of lunar phases and sea birds and found, "Their activities at night changed synchronously with the lunar phase: birds flew for longer periods and landed on water more frequently on nights with a full moon than when there was a new moon. Our results indicate that at-sea behaviour of pelagic seabirds is closely associated with the lunar cycle."

Furthermore, there are many people who believe a similar link can be found between lunar phases and stock market behavior. Among the studies done, the most famous is the University of Michigan Business School's "Are Investors Moonstruck? Lunar Phases and Stock Market Returns" in which they found slight evidence that returns are greater near certain lunar phases. In another study, "Lunar Cycle Effects in Stock Returns" Ilia Dichev and Troy James find that over 60% of the time, they can use lunar cycles to accurately predict the direction of a stock's price.

Thus at least there's something that might prove that lunar cycles effects stock market returns; however, for our purposes, lunar phases are used for timing purposes. It really has nothing at all to do with returns, but trend reversals. When you learn to use lunar phases to help with timing trend reversals, then you're so much closer to mastering cycles trading.

Our Metalicycles Research Report shows you exactly how to make consistent profits by using lunar cycles to your advantage.