Driving cycles with sensible cash
In commodities, historical past doesn’t simply rhyme; it repeats with exceptional precision. 12 months after yr, markets swing in acquainted rhythms: oil climbs with the summer time driving season, gold glitters forward of Diwali, and copper wakes up after China’s New 12 months lull. For merchants tuned in to those cycles, seasonality is greater than background noise; it’s an edge.
What separates professionals from hopeful speculators, nevertheless, is not only recognizing these patterns however aligning with the flows that really drive markets: establishments, not retail noise. When seasonal biases meet institutional momentum, the chances tilt decisively in favour of those that are affected person sufficient to attend for his or her second.
The rhythm behind commodity costs
Ask any farmer or refinery operator, and so they’ll inform you: commodities stay by nature’s calendar. Climate, planting, harvesting, and cultural demand cycles create recurring peaks and troughs. Add human behaviour into the combination, merchants who return to acquainted trades annually, and also you get a market the place predictability meets alternative.
That predictability is self-fulfilling. If sufficient hedge funds count on crude oil to agency in June, their collective shopping for ensures it typically does.
Patterns that preserve paying
Look again a decade, and the proof is tough to disregard:
Copper: Demand revives after the Chinese language New 12 months as factories hearth up once more.
Silver: February rallies coincide with jewelry shopping for and speculative positioning.
Corn: Costs typically sag from Might to August on oversupply fears.
Crude Oil: June power rides the U.S. summer time driving season.
Espresso: October–November rallies replicate harvest cycles.
Gold: Costs shine within the weeks main as much as Diwali as demand spikes.
Heating Oil: Winter months persistently drive consumption increased.
These aren’t one-off flukes. They’ve repeated for greater than a decade — and the charts show it.
Buying and selling with the tide
This implies watching the Dedication of Merchants (COT) report back to see how hedge funds and asset managers are positioned.
If internet longs are rising in an asset with a bullish seasonal bias, establishments are quietly accumulating. That’s the time to step in.
If internet longs are falling throughout a bearish seasonal window, it’s normally an indication to get quick.
This isn’t about reacting to headlines. It’s about anticipating strikes earlier than the gang catches on — and exiting earlier than the tide turns.
Studying the market’s temper
Charts and flows inform a lot of the story, however candlesticks typically whisper the remainder.
An engulfing candle at a assist zone, a pin bar rejecting increased costs, or a
morning star on the backside of a seasonal dip — these are clues that conviction
is shifting. Mixed with seasonal bias and institutional affirmation, they’re
highly effective timing instruments.
Why it issues
Markets are noisy, crowded, and more and more algorithm-driven. Seasonality
cuts by the muddle by anchoring trades to structural patterns, whereas
Institutional knowledge helps affirm you’re not buying and selling towards the tide. The
takeaway? Commodity cycles aren’t folklore. They’re a repeatable roadmap.
Traders who respect them don’t chase headlines; they plan, place, and
Exit with precision.
Ultimate phrase
Buying and selling seasonality isn’t about guessing. It’s about listening to the market’s calendar and shifting in sync with the largest gamers within the room. For these prepared to review the patterns, the payoff isn’t simply in earnings—it’s in readability.
Temitope George Ijibadejo is an award-winning Foreign exchange fund supervisor with over 15 years of expertise as a Foreign exchange fund supervisor and enterprise guide. He’s at present the African Regional Director for SquaredFinancials, a number one buying and selling platform in Nigeria and Africa.
