A Relevant and Quality Seasonality Study

Courtesy of Nautilus Research (@NautilusCap), the above chart illustrates what happens in equites after we see a negative month of January, when it comes after three or more prior years of gains. This is a focused and relevant seasonality study, which is important because it can be very easy to find erroneous, biased, and misguided seasonality studies on the internet. As you can see, a negative January after three or more prior years of gains, which we are on track for this month, does not bode well for equites for February, the rest of this year, and the year as a whole. Seasonality is simply one tool in your toolbox, and should never be solely relied upon as an actionable indicator. However, it can indeed supplement your trading process well, given the proper context of technicals and risk management.