Here are the historical tendencies for forex pairs and commodities in the month of August. Statistics include how often the prices rise or fall, and by how much, on average. Tickers mentioned: $AUDUSD $GBPUSD $USDJPY $NZDUSD $USDMXN $NG_F $GC_F
Statistics are based on monthly opening and closings prices, and do no reflect overall volatility that occurs during the month. Commodity statistics are based on a continuous futures contract, which may differ from specific contract statistics.
Statistics are run on USD Index, AUDUSD, USDCAD, USDCHF, EURUSD, GBPUSD, USDJPY, USDMXN, NZDUSD for currencies and on light crude, natural gas, corn, gold, silver, copper, coffee, sugar and wheat for commodities. Only the commodities and currencies on this list that tend to rise/fall in August more than 68% of the time (over the last 20 years) are discussed below. Other assets that are noteworthy but that don’t meet that 68% threshold may also be discussed. Applicable ETFs are also mentioned.
Seasonality statistics are best utilized in conjunction with strategies that provide exact entry, exit and risk management protocols. For examples of such strategies, see the Forex Strategies Guide For Day and Swing Traders.
Forex Seasonality For August
AUDUSD: The AUDUSD has fallen in 14 out of the last 19 years (74%). The average loss is -1.4%.
This would indicate the AUDUSD forex pair could be under downward pressure in August.
The Australian Dollar ETF (FXA) has dropped in 9 of the last 11 years (falling 82% of the time), declining -1.9% on average.
GBPUSD: The GBPUSD has fallen 13 out of the last 19 years (68%). The average loss is -0.8%. Over the last 10 years, the pair has fallen 80% of of the time, dropping by -1.6% on average.
This would indicate the GBPUSD forex pair could be under downward pressure in August.
The British Pound ETF (FXB) has dropped in 8 of the last 11 years (falling 73 % of the time), declining -1.3% on average.
USDJPY: The USDJPY has fallen in 13 out of the last 19 years (68%). The average loss is -1.3%. More recently, the results are mixed. Over the last 10 years, the USDJPY has fallen only 50% of the time, but has still lost -0.5% on average.
This would indicate the USDJPY forex pair could be under upward pressure in August.
The Japanese Yen ETF (FXY) has rallied in 5 of the last 10 years (50%), moving up 0.6% on average.
NZDUSD: Long-term there isn’t much of a seasonal pattern, but in the shorter-term, some of the biggest moves have come in August.
The NZDUSD has fallen in 8 out of the last 10 years (80%). The average loss is -2.5%.
This would indicate the NZDUSD forex pair could be under downward pressure in August.
USDMXN: August is the strongest month of the year for the USD versus the MXN. The USDMXN has risen in 14 out of the last 19 years (74%). The average gain for the USD (or loss for the MXN) is 2%.
This would indicate the USDMXN forex pair could be under upward pressure in August.
Commodity Futures Seasonality For August
Natural Gas (NG) tends to be weak in August. It has rallied in August only 11 out of the last 19 years (42%). The average loss for Nat Gas during the month is -2.8%.
August has been the worst month for the United States Natural Gas Fund (UNG). It was fallen 80% of the time over the last 10 years, and has declined on average -7.8%.
Gold (GC) tends to be strong in August. It rallied 12 out of the last 19 years (63%) and have moved by 1.5% on average. Shorter term is done even slighter better, as the ETF shows…
The SPDR Gold Shares (GLD) has moved up 75% of the time over the last 13 years, rallying by 1.7% on average.
Final Word on Forex and Commodity Seasonality
This is the raw data. What you do with it is up to you. All traders are encouraged to do their own research and apply their own strategies if utilizing these statistics.
Apply other technical and fundamental metrics to help zero-in on exact entry and exit points. Seasonality is not covered in my stock or forex trading course because it is a not a requirement for successful trading. That said, it is an additional tool you can use.
Losing trades WILL happen. Don’t risk more than 1% (or 2%) of your trading account on a trade (risk = difference between entry price and stop loss price, multiplied by the number of shares). There is always a risk in trading, and you can lose much more than you expect (even when you think you are only risking 1%).
By Cory Mitchell, CMT
Disclaimer: This article should not be viewed as investment advice, and is not a recommendation for you to buy or sell. Past performance is not necessarily indicative of future performance.