The Three C’s of December Seasonality

As most of you know, seasonality is one of the many tools that we have as technicians. It’s not the most important thing; it’s just a supplement like everything else outside of price. But I’d rather have seasonality in my favor, rather than fighting historic trends.

Todd Shriber over at ETF Trends put together a nice piece yesterday using some of my commodity seasonality charts. He called it, “Three C’s of Commodities Enter Seasonal Sweet Spot”. The three C’s he is referring to are Cotton, Coffee and Corn. Him and I both find it interesting that December historically represents the best month of the year, by far, for both Cotton and Coffee. The third one, Corn, is entering the sweet spot of its best period of the year and December specifically is historically very bullish.

Here are the 30-year average seasonal charts for the three commodities


12-4-13 Cotton SeasonalityCoffee:

12-4-13 Coffee seasonalityCorn:

12-4-13 Corn seasonality

Notice how all three, on average, tend to rally into the end of the year. Some people might wonder why, but I’m not one of those. I’m not really interested in the reason.

So we take this information, and if the price is right, and a good risk/reward presents itself in any of these, it’s nice knowing that you have the wind to your back.

Let me reiterate that I would never ever just buy any of these blindly simply because December is usually a solid month. The same can be said about any seasonality charts that we look at (I try to look at them all). But I do find it interesting that all three of these tend to do very well this time of year.

Let’s see what happens.




Three C’s of Commodities Enter Seasonal Sweet Spot (ETF Trends)

Tags: $KC_F $CT_F $ZC_F $CORN $JO $BAL