Stock Market Seasonality Indicator – Free Download for TradeStation, NinjaTrader & MultiCharts

Stock market seasonality is real – but raw statistical patterns alone won’t give you an edge.

To use seasonality profitably, you need a fundamental reason behind the pattern. Earnings cycles, tax deadlines, index rebalancing, mutual fund distributions – these are the mechanisms that move money in predictable ways at predictable times each year. Find those, and you have something worth trading.

This page gives you five fundamentally supported seasonal trades and a free seasonality indicator to time them – available for TradeStation, NinjaTrader, and MultiCharts.

Just wanted to send a quick note to say ‘Thanks’ for the free seasonality indicators. Very cool. I’ve been focusing on swing trading lately (using your indicators, of course) and these are great additional tools.

John J.

It seems you’ve come up with a brilliant new approach to seasonality! Thank you.

Ron F.

Here are 5 seasonal trades with strong fundamental support, along with a free seasonality indicator to help you hunt them down.

Key Takeaways

• Stock market seasonality is real, but only useful when it has a fundamental driver behind it – earnings cycles, tax deadlines, index rebalancing, and institutional flows
• The two major seasonal “legs” run October to April (bullish) and May to October (bearish) – though annual trend can easily overpower both
• Five specific seasonal trades have the strongest fundamental support: Santa Claus Rally, Tax Time, 4th of July, September Effect, and Thanksgiving
• The daily seasonality indicator forecasts the next 3 days of seasonal pressure – use it to time entries and exits within the broader seasonal window
• Free code available for TradeStation (EasyLanguage), NinjaTrader, and MultiCharts – no subscription required

The 2 major stock market seasonality patterns

The weekly seasonality indicator shows the stock market has two major biases each year. One up leg starting in late October and running until the end of April the following year. Then the down leg starts in early May and continues until late October.

The variation in this pattern from year to year, though, is huge. If you plot each year on top of each other, you’d swear there was no discernible pattern. And the annual trend can easily disguise any seasonal strength or weakness. For example, in 2013, the market continued to power ahead, even during the “sell in May and go away” season, traditionally weak.

The weekly seasonality chart is best used as a filter. During the October-to-April bullish window, look for long setups with greater conviction. During the May-to-October window, be more selective on longs and quicker to take profits. Don’t use it to predict exact turns – use it to know which direction the wind is blowing.

5 Seasonal trades with fundamental support (and when to trade them)

Within this broad seasonal pattern in the stock market, there are some great trading opportunities. If you’re not going to trade them, at least don’t bet big against them:

1. Santa Claus Rally: Strength from mid-December to the first week in January. Driven by the bullish holiday spirit, investment flows into value and small-cap stocks, as well as year-end “window dressing”. Approximate dates: 19 December to 9 January.
2. Tax Time: Weakness from early to mid-April, followed by strength from mid to late April. Driven by profit taking in stocks to pay taxes, followed by investment flows into tax-advantaged vehicles. Approximate dates: 9 April to 25 April.
3. 4th of July: Strength from late June until after the 4th of July. Driven by the bullish holiday spirit. Approximate dates: 1 July to 8 July.
4. September Effect: Weakness from early September to late October. Driven by ‘tax loss harvesting’ by mutual funds, 3rd quarter profit warnings by corporates going to miss their year-end targets and reduced share buybacks (prohibited pre/post earnings announcements). Approximate dates: 19 September to 3 October.
5. Thanksgiving: Strength during late November. Driven by the bullish holiday spirit. Approximate dates: 22 November to 10 December.

Each of these seasonal trades has a fundamental reason driving investment flows and the stock market behaviour. Not unlike the stock market strength we see just before the end of the month and beginning of the next month, which is driven by:

• Liquidations 3-5 days prior to the end of the month to pay month-end distributions
• Then, the end of the monthly performance “window dressing” by fund managers, and
• Followed by new investment inflows at the beginning of the new month.

This big-picture investment flow repeats year after year.

Stock market seasonality patterns by month

Here’s how the seasonal bias typically plays out month by month. Use this as a reference alongside your own chart analysis – not as a fixed forecast.

Month	Typical Seasonal Bias	Primary Driver
January	Bullish	January Effect, new investment inflows
February	Mixed to weak	Post-January profit-taking, earnings season wind-down
March	Bullish into late March	Quarter-end window dressing by fund managers
April	Volatile – weak early, strong late	Tax selling (early), then tax refund inflows (late)
May	Turning bearish	“Sell in May” institutional repositioning begins
June	Weak to flat	Low volume, summer drift begins
July	Bullish around 4th of July	Holiday effect, light volume drives upside
August	Weak	Low volume, late summer distribution
September	Bearish	Historically the weakest month – mutual fund tax-loss selling
October	Volatile, then bullish	Bear market “killers” historically, October reversal effect
November	Bullish	Thanksgiving seasonal rally, fiscal year-end buying
December	Bullish	Santa Claus Rally, year-end window dressing

Note on April stock market seasonality: April deserves special attention because it has two distinct phases. The first two weeks often see weakness as investors sell holdings to cover tax bills. Mid-to-late April frequently sees a sharp reversal as those same dollars flow into tax-advantaged accounts like IRAs and 401(k)s. This is one of the more consistent and fundamentally driven seasonal patterns in the calendar.

Note on February stock market seasonality: February is often the weakest month of the first quarter. The post-January euphoria fades, earnings season is wrapping up, and institutional positioning can get choppy. It’s not a strong seasonal either way – treat it as a low-conviction period.

Note on July stock market seasonality: The 4th of July window is one of the cleaner seasonal setups. Light volume heading into the holiday, combined with bullish holiday sentiment, has historically produced a consistent short-term upward bias, typically from late June through the first week of July.

How to use the daily seasonality indicator to time entries

The weekly seasonality indicator tells you which direction the seasonal wind is blowing. The daily indicator tells you when to act.

The daily seasonality indicator dynamically calculates the seasonal pattern and plots a 3-day forecast. During a seasonal window, it can signal when the move is likely to accelerate – giving you a timing edge for entries and exits that the weekly chart alone can’t provide.

Use the two together: the weekly indicator identifies the seasonal window, the daily indicator times your trade within it. You still need price-based confirmation – a breakout, a reversal pattern, volume confirmation – before pulling the trigger.

During this latest Tax Time weakness (April 2014), it warned of a strong 3-day sell-off that resulted in a 65-point down move in the Emini. And we’re in the middle of the bounce back – again, part of the Tax Time seasonal pattern – as I’m writing this. And the daily seasonality indicator is forecasting it’s got 2-3 days more to run.

Case Study: The Tax Time seasonal trade in action

And now, a week later, we can see that the 2014 Tax Time seasonal trade played out perfectly. The seasonal indicator caught the High before the market sell-off, caught the Low as the market bottomed, and forecast a strong bounce back, too. A beautiful “V” reversal pattern.

Don’t expect seasonal trades to work out so perfectly every time. You’ll need other indicators to time your entries and exits. But the 2014 Tax Time seasonal trade is a nice showcase of the power of seasonal indicators.

Case Study: The September Effect seasonal trade

A few months after the 2014 Tax Time trade, the September Effect seasonal trade started to line up. The Emini-Watch blog warned of this upcoming seasonal weakness, which was difficult to do as we were in the middle of a massive QE and buyback-driven rally.

But then the 3rd quarter profit warnings started to come in – and that’s the primary driver of this particular seasonal trade. In addition, we had some big disappointments overseas: Tesco in the UK and Sony in Japan. This led to a 10% sell-off in the Emini over the next 3 weeks. Beautifully timed.

Keep track of the seasonal trades with this calendar

If you use Google Calendar, just hit the “+” button (bottom right on the calendar below) and it will import this Emini trading calendar into your personal Google Calendar.

The calendar can also be imported into other calendar applications via these links: iCal format and HTML format. The calendar also includes important Emini trading dates, like contract rollovers and trading holidays.

Free seasonality indicator vs paid tools (Seasonax, Equity Clock)

Several paid tools have built subscription businesses around stock market seasonality data. Here’s how the free indicators on this page compare:

Feature	This Free Indicator	Seasonax (paid)	Equity Clock
Platform	TradeStation, NinjaTrader, MultiCharts	Web browser	Web browser
Cost	Free	$35–$100+/month	Free (limited)
Integration	Runs on your live chart	Separate tool	Separate tool
Customization	Full code access	None	None
Fundamental context	Yes	No	No
Data source	Your broker feed	Proprietary	Proprietary

The main advantage of having the seasonality indicator built directly into TradeStation or NinjaTrader is that it overlays on your actual trading charts – you’re not switching between tabs or cross-referencing a separate website when you’re watching a live market.

The code is open source (included in the TradeStation download), so you can inspect exactly how the calculations work and modify them if needed. That’s not something you get with subscription tools.

Download the free Seasonality Indicator (TradeStation, NinjaTrader, MultiCharts)

The seasonality indicators are free to download and use. No subscription required.

What’s included in the TradeStation download:

• _Seasonality Indicator (weekly) – plots the annual seasonal bias on your chart
• _Seasonality Indicator Daily – forecasts the next 3 days of seasonal pressure
• EasyLanguage source code so you can inspect and modify the calculations

Installation note: Plot the _Seasonality Indicator on a daily chart with at least 10 years of back history, starting on 1 January. The indicator needs this data for the seasonal calculations to work correctly. Applying it to a chart with a limited history will produce inaccurate results.

Many thanks to Brian McKellar for building the NinjaTrader version.

Frequently Asked Questions