Using seasonals to time entries for the DAX [Video]

Giles Coghlan LLB, Lth, MA Financial Source

One of the benefits of Seasonax is that you can quickly discover seasonal patterns that occur in a variety of instruments. There are a large number of ways that you could use this, however, one obvious way would be to find times of the year when the index tends to gain.

The DAX shows two key times of the year that it tends to gain. These times start in March and in October. Over the last 25 years, the DAX has seen marked gains during this time. So, with so much uncertainty surrounding the path of stocks this year this information can be very helpful. From a seasonal point of view buying the DAX around the start of October has seen some impressive results. From October 01 through to December 31 the DAX has gained 21 times for an average return of 7.82% and an annualised return of 34.42%. So, are you using Seasonal to help you time entries into major indices?

Major trade risks: The biggest risk here is if there are reasons for USD strength and EUR weakness into year-end that can contradict this seasonal pattern.

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Author

Giles Coghlan LLB, Lth, MA

Financial Source

Giles is the chief market analyst for Financial Source. His goal is to help you find simple, high-conviction fundamental trade opportunities. He has regular media presentations being featured in National and International Press.

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