Trader Lesson: Trading with Seasonals on Your Side, Part 2 of 3

10/06/2017 6:00 am EST

Focus: STRATEGIES

Jake Bernstein

Publisher, The Jake Bernstein Online Weekly Capital Markets Report and Analysis

We enter the most predictably bullish timeframe of the entire year. And if we believe that history repeats, then we have some immensely powerful information at our disposal. All we need now is to believe it and not overthink it, writes veteran trader Jake Bernstein.


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Wouldn’t it be wonderful if everything in trading was 100% predictable? As good as this may sound the end result is illogical because if everything was 100% predictable we wouldn’t need to predict anything. We would live in a perfect world with perfect economies and perfect markets. In fact, there would be no need for markets.

Pardon my brief indulgence in this nonsense. It is merely a preamble to the statement that as good as seasonals are (and they are without a doubt the best thing I know) they are not 100% accurate. As traders, we understand this and we accept it as part of the game we play.


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Having dispensed with the public health warnings I offer you the following example of seasonality as we enter the most predictably bullish timeframe of the entire year. Note that this is not a recommendation to buy or sell securities or futures. It is simply a statement of history. And if we believe that history repeats, then we have some immensely powerful information at our disposal. All we need now is to believe it and not overthink it.

Shown below Is a Weekly Seasonal Composite Chart of S&P Futures illustrating what has historically happened on average, week by week.

As you can see, during October, November, and December the tendency has been up. Clearly, the arrows up and the plot of the graph shows upside movement with percentages up and down week by week.

The chart is impressive. The history is lengthy. But how do we use it? I will illustrate the uses of this type of information in the next installment. In the interim, should you have more interest in seasonality visit one of my websites: www.seasonaltrader.com

Trade well and prosper.

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