Here are the historical tendencies for forex pairs and commodities in the month of December. Statistics include how often the prices rise or fall, and by how much, on average. Tickers mentioned: NZDUSD. Also, check out the best-performing stocks in December.
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 October more than 65% of the time (over the last 20 years) are discussed below. Other assets that are noteworthy but that don’t meet that 65% 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 December
For most major forex pairs, there isn’t a significant and consistent bias higher or lower in the month of December. The exception is the NZDUSD.
NZDUSD: Over last 20 years the NZDUSD has risen 14 out of last 20 years (70%), and moved up 1.4% on average during December.
Commodity Seasonality For December
Studying the commodities, there were no strong or consistent tendencies in the month of December. It’s a coin flip as to whether they will rise or fall in a given year.
Final Word on Forex and Commodity Seasonality
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 may 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.