From this point on, WTI falls during US election years!

Last Updated: 7. März 2024By

Remember? Today is the seasonal deadline for falling WTI prices. After our recent successful trade on rising oil prices – also due to seasonality – we are now turning the tables.

I have already provided you with the numbers, data and facts. In summary, it turns out that in the last US election years, WTI prices typically fall from today until April 4th.

The average decline during this time is 8.11 percent. From today’s perspective, the course would look like this.

WTI in daily chart The blue downward trend marked here would be the average of how oil falls during election years in this period. When we compare this with previous movements in the chart, it seems absolutely realistic. Just as quickly as prices climbed in February, they could now go back down.

(Source: Between January and February, there was a week in which prices almost covered the distance south. Athletic movements are always possible with oil. So why not also go down now?

We only get the average of 8.11 percent because I ignore the Corona year 2020 in the calculation. Otherwise, we would be at an average of 17 percent minus. But because 2020 was an extreme outlier year – especially for oil – I prefer to ignore this data.

Of the remaining 5 election years since 2000, only the year 2008 was positive in the period between March 7th and April 4th.

The current course of the year in WTI confirms the seasonality. Therefore, with my trade, I give prices the chance to continue following this pattern. I have chosen a turbo short with a leverage of 7. The knock-out is 10 US dollars above the current prices.

According to seasonality, prices have only risen by a maximum of 5 percent until April 4th – even if they then fell again. We definitely need a bit of leeway. We even had this increase in 3 out of 5 cases! Exceptions were the years 2000 and 2012.

If this also happens this year, WTI could rise a bit until mid-month before the significant correction sets in.

Conclusion: Seasonality is a mix of number games and rhyming stock prices. Not every year follows the average guidelines. Therefore, these trades are not guaranteed winners.

However, if we look at the good results of the current year, prices could continue to roughly follow the patterns of past election years. We will have to take stock and close the trade by early April at the latest. Until then, we give WTI a bit of room to rise before it can go down like oil.