MRCI is a great tool for seasonal research, seasonal spreads and more. used by many professionals and even the exchanges. www.mrci.com
We actually wrote a good article about seasonality in futures.
As far as Natural Gas, here is my opinion for what its worth....
Please register on futures.io to view futures trading content such as post attachment(s), image(s), and screenshot(s).
PM with any questions about Cannon Trading (800) 454-9572 (310) 859-9572. Trading commodity futures, forex and options involves substantial risk of loss. The recommendations contained in this post are of opinion only and do not guarantee any profits. These are risky markets and only risk capital should be used. Past performance is not necessarily indicative of future results.
I've never been a real fan of just using seasonals alone. Also, don't like the idea of basing a decision on only 15 occurrences...not a statistically significant number.
Moore Research has been around a long time. What I'd like to see is how a seasonal trade has played out over the last forty years, because they DO have the data. Fifteen years just seems like curve fitting to me.
Well, I was long NG to start the day on Friday, thinking it would recover after the report. Needless to say I got out quick prior to the official open of the market and so glad I did. Regret the fact that I noticed the short opp the week before and got stopped out repeatedly, then just left it alone. I made the mistake of thinking it had sold enough and tried to turn around and catch the rally back, but after the report on Thursday, there was no rally, and every up was a chance to sell.
Did the same thing with SI a few weeks ago. I was long at the top, and managed to get out on that last huge run up spike prior to the sell off 9/30/16. Working on re-wiring my system so that I can sell those run ups but it's hard to do. When I see the market moving like that, I want to be in it, want to be long, but all it is are market makers making a ramp to sell from. ES/YI/NQ did the same thing the night before BREXIT, Rallied right up to the release. I did catch that one though and loaded up on UVXY as the price was drove down into the ground. Again the forsight to sell some futures contracts there would have ended in a pile of $$$. Maybe one day I'll get it.
In my opinion it does not make sense to consider too many years back.
Fundamentals for most of the commodities change over time. An example: 50 years ago there were not many soybeans grown in South America. Thus, the seasonal charts going back too far do not fully include the growing cycle in these countries.
There is a danger of curve fitting. Thus, I consider it to be important not only to have a look at the seasonal chart, but to check the charts for each single year. Only seasonal charts, which are confirmed by most of the individual years look promising. (Even more, if you are able to find out, why in some years this seasonal trade failed.)
Furhermore, trades that follow the seasonal chart for some weeks or months are more promising than others.
Best regards, Myrrdin
The following 2 users say Thank You to myrrdin for this post: