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Since a new month has started, the best way to asserts the probability of where the market is likely to be heading in this month is for us to look at the seasonality patterns. The seasonality cycles will bring in a new dimension in which you can analyse the market. Seasonality are a predictable change in price that repeats every day, week, month, year at the same period in time.
You can find more details how this seasonal patterns affect the exchange rate and more importantly how to correctly use them in your trading activity in one of my articles here: Seasonal Cycles in FX Trading
This seasonality cycles will only give you the tendency of an particular currency pair to bottom or top or rally or fall, at certain point in time. Going forward we're going to analyse what are the November seasonal patterns in FX market.
I would like to start first by looking at the broad based dollar strength/weakness because of the current massive bullish dollar trend, every move in the FX land will be depended on the dollar move. It comes as no surprise last 2 months we had general weakness in the Dollar, look at the chart above how strong the cycle was during that time of the year, you just couldn't ignore it. Jun on the other hand look quite mixed and there is no strong seasonality, we can only tell that during the first half of the month we have general strength which will be erased in the second half of the month when the dollar retrace.
EUR/USD provides no clear pattern during this time of the year so in this case it's best to ignore the seasonality pattern, we only want to look into those case when we have strong moves in one direction or the other.
The reason why I want to bring to your attention USD/CAD is because it has a strong pattern to sell of during the month of Jun, weakness that caries on all the way through July where we establish a major bottom. This doesn't mean that we are going to have the same scenario because if we look on chart above we can tell that in 2011 it didn't behave as expected, however the probability are favoring this pattern to unfold.
The last pair I want to talk is cable which is also showing a strong seasonal pattern to bottom during summer time. We can see that this pattern is quite strong and the general strength caries on all the way through July until August comes in and where we have another strong seasonality pattern. don't forget never use this information alone but instead use the technical tools to confirm this ideas or not.
Best Regards,
Daytrader21
You can find more details how this seasonal patterns affect the exchange rate and more importantly how to correctly use them in your trading activity in one of my articles here: Seasonal Cycles in FX Trading
This seasonality cycles will only give you the tendency of an particular currency pair to bottom or top or rally or fall, at certain point in time. Going forward we're going to analyse what are the November seasonal patterns in FX market.
- Dollar Index Jun Seasonal Pattern
I would like to start first by looking at the broad based dollar strength/weakness because of the current massive bullish dollar trend, every move in the FX land will be depended on the dollar move. It comes as no surprise last 2 months we had general weakness in the Dollar, look at the chart above how strong the cycle was during that time of the year, you just couldn't ignore it. Jun on the other hand look quite mixed and there is no strong seasonality, we can only tell that during the first half of the month we have general strength which will be erased in the second half of the month when the dollar retrace.
- EUR/USD Jun Seasonal Pattern
EUR/USD provides no clear pattern during this time of the year so in this case it's best to ignore the seasonality pattern, we only want to look into those case when we have strong moves in one direction or the other.
- USD/CAD Jun Seasonal Pattern
The reason why I want to bring to your attention USD/CAD is because it has a strong pattern to sell of during the month of Jun, weakness that caries on all the way through July where we establish a major bottom. This doesn't mean that we are going to have the same scenario because if we look on chart above we can tell that in 2011 it didn't behave as expected, however the probability are favoring this pattern to unfold.
- GBP/USD Jun Seasonal Pattern
The last pair I want to talk is cable which is also showing a strong seasonal pattern to bottom during summer time. We can see that this pattern is quite strong and the general strength caries on all the way through July until August comes in and where we have another strong seasonality pattern. don't forget never use this information alone but instead use the technical tools to confirm this ideas or not.
Best Regards,
Daytrader21
