Search around the internet and you will find people promoting the concept of seasonality. The above chart of Copper price is a typical example. Look at the left side of this chart. The suggestion is that Copper prices will rally strongly in the February to May time period. Surely this must mean that here and now I should be buying copper-related mining stocks?
Not so fast!
These seasonality charts are based on many years of price data. The above chart is based on 30 years of price data. Over the scope of 30 years, if several years posted strong gains February through May, those data points would more than compensate for multiple years of soft price data.
As a trader or investor, how do you use these seasonality charts and at the same time stay out of trouble?
The answer is to use some basic astrology.
The starting point for the application of this basic astrology is to look at the first trade horoscope. In the case of Copper, we need to study the natal horoscope for Copper futures which started trading in 1988.
The second step is to look at past price data for Copper in the context of this basic astrology.
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