One of the key features around seasonality is the so-called turn-of-the-month effect. This is when major indices tend to gain around the end of a month and into the first few days of the new month.
However, using Seasonax you can also look at the seasonality for indices around the middle of the month This can show some surprising seasonal biases. The Nikkei, for instance, has a 60% bias towards winning trades on the first two days after the third of the month. The average return is 0.29% of the average profit is 52.52 points.
On the next 5 days after the turn of the month, the winning percentage remains around 60% with the average return increasing to 0.41%. With investors having been turning positive on Japanese stocks earlier this year, will the outlook for the Nikkei be positive around the turn of the month? This is another seasonal pattern to consider.
Major Trade Risks: The major trade risks here would be further talk of the BoJ exiting negative interest rates which can strengthen the JPY. A strong JPY is a natural headwind for Japan’s export-heavy Nikkei.
Disclaimer: Past results and past seasonal patterns are no indication of future performance, in particular, future market trends. seasonax GmbH neither recommends nor approves of any particular ...
Disclaimer: Past results and past seasonal patterns are no indication of future performance, in particular, future market trends. seasonax GmbH neither recommends nor approves of any particular financial instrument, group of securities, segment of industry, analysis interval or any particular idea, approach, strategy or attitude nor provides consulting nor brokerage nor asset management services. seasonax GmbH hereby excludes any explicit or implied trading recommendation, in particular, any promise, implication or guarantee that profits are earned and losses excluded, provided, however, that in case of doubt, these terms shall be interpreted in abroad sense. Any information provided by seasonax GmbH or on this website or any other kind of data media shall not be construed as any kind of guarantee, warranty or representation, in particular as set forth in a prospectus. Any user is solely responsible for the results or the trading strategy that is created, developed or applied. Indicators, trading strategies and functions provided by seasonax GmbH or on this website or any other kind of data media may contain logical or other errors leading to unexpected results, faulty trading signals and/or substantial losses. seasonax GmbH neither warrants nor guarantees the accuracy, completeness, quality, adequacy or content of the information provided by it or on this website or any other kind of data media. Any user is obligated to comply with any applicable capital market rules of the applicable jurisdiction. All published content and images on this website or any other kind of data media are protected by copyright. Any duplication, processing, distribution or any form of utilisation beyond the scope of copyright law shall require the prior written consent of the author or authors in question. Futures and forex trading contains substantial risk and is not for every investor. An investor could potentially lose all or more than the initial investment. Risk capital is money that can be lost without jeopardizing ones’ financial security or lifestyle. Only risk capital should be used for trading and only those with sufficient risk capital should consider trading. Past performance is not necessarily indicative of future results. Testimonials appearing on this website may not be representative of other clients or customers and is not a guarantee of future performance or success.
