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Home Help Pages Frequently Asked Questions Charts Seasonal PATTERN Chart Explanation

Seasonal PATTERN Chart Explanation

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1. How do I read your Seasonal Pattern Charts?

The scale from 0 to 100 on the right-hand side of the lower chart is simply MRCI's seasonal index. The graph at 0 signifies the seasonal low --- when prices have most consistently been low(est) during the year.
In contrast, the graph at 100 identifies the seasonal high --- when prices have most consistently been high(est). The graph at 20, for example, suggests when prices have tended to be in the lower 20% of
the year's range.  In other words, one could ignore the scale and simply look at the graph.

When we generate a seasonal pattern, we do not average prices.  The operative word in seasonal pattern is PATTERN.  It is fixed to time but not to price.  When we generate the charts with the seasonal pattern overlaid on current market prices, the computer tries to match the seasonal PATTERN with the PATTERN of trading exhibited so far by the current market.  Thus, as the current market traded higher, the computer was forced to "lift" the seasonal pattern higher to try to fit with the pattern of trading in the current market.

The seasonal pattern can be used only for TIMING and DIRECTION --- not for suggesting a price objective.  For the latter, we have provided the daily, weekly, and monthly price charts.

What we want to know is when a market tends to peak, when it tends to bottom, and when it tends to trend and in which direction.

As you scroll your cursor along a Seasonal Pattern chart, immediately below the title will appear the date, the duration (such as 30-year) of each pattern illustrated, and a number (such as 50.83) linked to that date and pattern.  The numbers enumerate where prices have tended to be on that date on an index from 0 (the seasonal low) to 100 (the seasonal high) over the years in that pattern.  A number such as 50.83, for example, says prices on that date have tended to be almost dead center between the eventual high and the eventual low.

But we do not average prices to generate those numbers.  That would be like averaging silver at $4/ounce with silver at $40/ounce to arrive at ... a meaningless number.
Instead, we want to quantify a "normal" pattern of price behavior:  When do prices tend most consistently to be high (the typical seasonal high), when most consistenly to be low (seasonal low), and when and in which direction do prices tend to trend in between.

To create such a pattern, consider the following for Market XYZ:

Assume in Year #1 that the eventual high for the year was 40, the low was 10, and price on Day #1 was 16.  We would assign a value to Day #1 of 20 --- because its price of 16 was 20% off the low (10) toward the high (40).

Assume in Year #2 that the high was 45, the low was 25, and price on Day #1 was 28.  We would assign it a value of 15 --- because it was 15% off the eventual low (25) toward the eventual high (45).

We perform the same calculation for Day #1 of Years #3-30 --- and then average those values for Day #1.

Upon performing the same calculation for Days #2-365 for all 30 years, we connect the dots of all those values and --- a seasonal pattern appears.  (We then "normalize" the lowest value to 0 and the highest value to 100 to create the seasonal index.)

Additional information on our Seasonal Pattern Charts...

MRCI Help PDF

MRCI's Seasonal Pattern Chart Explanation

MRCI's Seasonal Pattern Chart Tutorial

 

MRCI Seasonal Pattern Chart Sample...

 

2. How can I order your Seasonal Pattern Charts?

MRCI has two separate products that feature our Seasonal Pattern Charts.

1. A subscription to MRCI Online!

200+ pages
5, 15 & up to 30-Year Seasonal Patterns
Bull/Bear Patterns
A new updated Seasonal Pattern Chart Book is released at the beginning of each quarter.
* Available in hardcopy format only
*View Table of Contents and Sample (PDF)

3. When are your Seasonal Pattern Charts updated?

Quarterly

 

4. Which product is better?

MRCI's #1 recommendation would be a subscription to MRCI ONLINE. The Seasonal Pattern Charts within MRCI ONLINE are much bigger and more interactive.

For example, you can add 5, 15, longest, bull & bear lines to each chart however you see fit. Plus, you can print each chart as a full 8 1/2 x 11 sheet where as the "hardcopy/mailed" book features 4 small charts per page.

Last Updated on Wednesday, 19 June 2019 08:35  
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