Summary
Phil Anderson marks the vernal equinox (March 21) as the true start of the trading year and flags it as a key potential turning point for US equity markets following a 10% S&P 500 correction from the February 19 peak. He argues the real estate cycle’s second half remains on track, citing recovering M2 money supply and a weakening US Dollar Index as supportive conditions. Gold breaking above $3,000/oz triggers upward stop adjustments on two existing Mex Pete portfolio positions.
Key Claims
- The vernal equinox (March 21) is a more meaningful calendar start than January 1, and equinox/solstice midpoints are historically significant trend-change dates — confidence: high (core PSE/Gann methodology)
- The S&P 500 peaked February 19 and dropped just over 10%, entering correction territory for the first time since late 2023 — confidence: high (factual/observable)
- The PSE forecast curve pointed to a low around mid-March and a rally into late April; the preferred 20/60 curve instead points to a low in late March, choppy April, then a rally into May — confidence: medium (model-dependent)
- The current correction is ~30 weeks from the August 2024 selloff and ~60 months from the March 23, 2020 COVID crash low — confidence: high (arithmetic time count, verifiable)
- US M2 rate of change has been rising steadily after going negative for the first time ever post mid-cycle slowdown, signalling improving liquidity — confidence: high (FRED data cited)
- Financial conditions remain loose; Anderson expects the Fed to ease further over coming months — confidence: medium (forward-looking opinion)
- DXY peaked in September 2022, rallied post-2024 US elections, but is now pulling back toward its prior trading range; the 100 level is the key watch level — confidence: high (chart-observable at time of writing)
- A DXY break below 100 would be a confirmatory “second half of cycle” marker — confidence: medium (cycle framework interpretation)
- Copper is close to breaking out to new record highs — confidence: medium (stated as near-term observation)
- Gold recently broke above $3,000/oz, setting fresh records — confidence: high (factual at date of writing)
Mex Pete References
- Anderson credits the “Mexican Pete” (Mex Pete) system as derived from a reading of page 67 of W.D. Gann’s Truth of the Stock Tape.
- The system is described as a method for identifying “the right stock at the right time” by reading which market sectors are moving and tracking ascending price structure (higher highs/higher lows).
- It is also used as a supplementary tool for locating one’s position within the real estate cycle.
- Two Mex Pete Model Portfolio positions are actively managed in this email: GMD and EVN (see Stock Picks below).
Stock Picks / Signals
| Ticker | Company | Action | Detail |
|---|---|---|---|
| GMD | Genesis Minerals | Hold / Raise Stop | Stop raised from 3.00** (adjusted to next higher low) |
| EVN | Evolution Mining | Hold / Raise Stop | Stop raised from 5.95** (adjusted to next higher low) |
- Both positions are making higher highs; stop methodology is trail to the most recent higher low on the chart.
- No new buy signals or price targets stated.
- Copper flagged as worth close monitoring for a potential record-high breakout (no specific ticker given).
Predictions / Forecasts
- S&P 500 low: Mid-March (primary curve) or late March (preferred 20/60 curve) — followed by rally
- S&P 500 rally: Into late April (primary curve) or into May after a choppy April (20/60 curve)
- US Dollar (DXY): Expected continued weakness; break below 100 anticipated as a second-half cycle confirmation
- Fed policy: Anderson expects further accommodation (rate cuts or easing posture) over coming months
- Commodities (gold, copper): Continued upside anticipated, supported by dollar weakness and rising M2
Notable Quotes
“Far better to remember the ‘time’ origins and start your year from the vernal equinox, March 21.”
“I do hope you’re seeing how the simple ‘Mex Pete’ system I developed out of a simple reading of page 67 of Gann’s Truth of the Stock Tape helps you to read markets even better AND to easily see which sectors of markets are moving: ‘the right stock at the right time’.”