March Madness; Is History About To Repeat?

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Following on from last year's "March Madness: Opportunity Building", chartist Daniel Goulding offers his prediction of what likely lays ahead for equity markets once again weakening in March.

There are more things in Heaven and Earth, Horatio, than are dreamt of in your philosophy.

— William Shakespeare, Hamlet (Act 1, Scene 5)

By Daniel Goulding

This time last year, I wrote an article titled “March Madness: Opportunity Building”, highlighting the tendency of equity markets to provide buying opportunities in March.

The ASX 200 index bottomed out slightly later than expected, on April 7, before soaring to new all-time highs by June.

Once again, we are confronted with significant weakness as we approach mid-March.

The apparent cause is geopolitical events in the Middle East. However, those who closely monitor the market will know that risk aversion has been escalating sharply since late January.

The ASX200 Equal Weight Index peaked on January 28. It was primarily the Top 20 stocks that were driving the benchmark index higher into late February, a classic sign of late-stage market behaviour.

And from a seasonal perspective, January to March is one of two periods when tail risk (the risk of bad stuff happening) is much higher. Exhibit One details the 20 worst single-day percentage declines for Aussie equities from 1985 through 2025.

Those who advocate for the conventional or Ptolemaic model of the financial universe may argue this is merely a statistical artefact – that by mining enough data, one can find all sorts of spurious correlations. But we know, strictly speaking, that the conventional model, just like the Ptolemaic model of the universe, is false.

As a technical analyst, I take an empirical approach. I believe there is sufficient evidence to take the correlation between geomagnetism and stock returns seriously.^{1 2 3}

Back in early February, I warned my readers that if we were to experience a mini-panic, early to mid-March would likely be the timeframe, given the Eclipse cycle.

Open-minded investors should mark March 19, the next new moon, on their calendars. This focal point is further amplified by the nearby March Equinox on March 21. I anticipate we will see a significant countertrend rally beginning around that period.

For those interested in my outlook for the next 12 months, Exhibit Two contains the forecast I presented to readers in mid-February.

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Daniel Goulding is a technical analyst with over 20 years of experience. He is the publisher of The Goulding Letter on Substack, and previously The Sextant Market Letter.

His Twitter handle is @CopernicusASX. In the past, he worked as an Authorised Representative of the Townsville branch of RBS Morgans, and later Grow Your Wealth Financial Services Townsville.

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1. Stephen Puetz, The unified cycle theory: How cycles dominate the structure of the universe and influence life on Earth (Denver: Outskirts Press, 2009).
2. Lifang Peng, Ning Li & Jingwen Pan, “Effect of Ap-Index of Geomagnetic Activity on S&P 500 Stock Market Return”, Advances in Astronomy 2019, https://doi.org/10.1155/2019/2748062.
3. Cesare Robotti & Anya Krivelyova, “Playing the Field: Geomagnetic Storms and the Stock Market”, Federal Reserve Bank of Atlanta Working Paper No. 2003-5b, (October 2003). http://dx.doi.org/10.2139/ssrn.375702

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