There can be a positive period of a year that goes beyond a period of one single month. Every financial instrument can have a different timespan in which its returns are significantly positive or negative. For example, Nikkei can be strong from half of March to the end of June while Copper can be weak from the start of October to the half of December.
In ForecastCycles we analyze this anomaly through the "Max_Min" strategy. The strategy is built by taking the most important maximum and minimum from the seasonal line, computed over the entire history of the financial instrument.
For example, starting from the detrended seasonality, used to identify better the top and bottoms, our algos identify the most important Max and Min of the seasonality, in this case of Apple Inc.
In this case the indications are:
- Long: from 09.Mar to 09.May
- Short: from 09.May to 03.Jul
- Long: from 03.Jul to 03.Sep
- Short: from 03.Sep to 03.Oct
- Long: from 03.Jul to 05.Nov