Astrologers have posited relationships between planets and signs since ancient times. Planets that most directly express the qualities of signs are called "rulers," as in Cancer is ruled by the Moon and Leo is ruled by the Sun. Rulerships are commonly employed in chart interpretation. For example, if you get a personal 30-Day Astrology Forecast, that information is factored in to create your report.
To explain further, if an individual has Aries on the cusp (border) of the Second House of Income, the astrologer will analyze the position of Mars, Aries' ruler, for further information on the subject. Its sign, house position and aspects will be included to describe income-related issues.
Exaltation also reflects an affinity between planets and signs, but is not used interpretively like rulerships. There isn't the linking, as in "the ruler of your Fifth House is in the Tenth," so it is a less dynamic factor in astrological analysis. Nevertheless, planets in signs of their exaltation are "dignified," i.e., strengthened, as are planets in the signs they rule.
Both show a positive connection between a planet and a sign, yet apart from this difference of application, the distinctions between rulership and exaltation are not entirely clear. One idea, however, is that exaltation represents the highest expression of a planet's energy while rulership is its most effective expression. The word "exalted" implies something superior, or an idealized form of a planet's potential.
Relationships between planets and signs
The Sun is exalted in Aries, the first sign of the zodiac, which represents pure existence. While the Sun rules Leo, where ego-consciousness is developed, Aries is the spark of life, its primal expression. A planet in the sign opposite its exaltation is in its "fall," symbolizing a difficult relationship between planet and sign. These categories reflect the similarity or dissimilarity of planet and sign and their ease of expression.
However, while some astrologers use exaltations and rulerships to describe the quality of the soul or the nature of past lives, it's important to consider that every chart is perfect in its own right. Easy is nice, of course, but not always better. The Sun's fall is in Libra, the relationship sign that must compromise solar will to meet the needs of others. The Moon, representing nourishment, is exalted in the rich Earth sign of Taurus. Contentment and material well-being are traditional qualities of the Bull that feed the needs of the hungry Moon. The Moon is in its fall in Scorpio where a profound sense of desire and expectation of loss is often a challenge to one's emotional comfort.
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Mercury is exalted in Virgo, making it exceptional since it also rules this sign. The mental acuity of the intellectual planet is raised in this rational and analytical Earth sign. Mercury's fall is in fuzzy Pisces where feelings dominate and logic may be lost in the fog of fantasy. Venus, on the other hand, is exalted in spiritual Pisces where its capacity for love is filled with idealism and compassion. Her fall, then, is in critical Virgo where the possibilities for love must be passed through the critical filters of this relatively unemotional sign.
Assertive Mars is exalted in ambitious Capricorn where its impulses to act are directed in a constructive fashion. The Warrior planet falls in Cancer where the drive to act is blunted by the self-protective instincts of the Crab. Jolly Jupiter is exalted in Cancer, where its generosity and wisdom are warmly lavished on close friends and family. But the optimistic nature of Jupiter is constrained in rigid Capricorn, the sign of its fall. Stern Saturn's exaltation is in justice-loving Libra where its deliberate style fits well. Impulsive Aries, though, is where Saturn falls with lack of preparation and foresight. The modern, outer planets Uranus, Neptune and Pluto were not given signs of exaltation.
A planet in its sign of exaltation resonates more purely. However, this "gift" can also reflect a lack of insight on processes that work well naturally. When planets are challenged by their fall, or by other technical "weaknesses," the journey to understanding them is further, but perhaps ultimately richer. There are, as well, specific degrees of exaltation for each of the visible planets that, in principle, enrich them further. However, these are not widely used in current astrological practice.