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Seasonals Plug-In Introduction

Video Transcript

In this Track 'n Trade Pro Seasonals Trading Training video, I want to talk to you and give you just a quick introduction to the Seasonals Plug-In. The Seasonals Plug-In comes as a separate Plug-In to Track 'n Trade Pro. It is an Indicator. It's a special Indicator that is designed for one specific purpose. That's because these markets have a very Seasonal nature to them.

Let's take this Wheat Contract for example, that we're looking at. Wheat is planted at the same time every year, it's harvested at the same time every year. It's susceptible to disease and fungus at the same time every year, destruction's at the same time every year. It's susceptible to price change and actions and distribution changes at the same time every year. Because of that, the market seems to generate price actions, based on those events at the same time every year. So, it's important for us, as traders, to know what these different seasonal events are doing to the market and what they have done to the market in past history.

That's what the Seasonals Plug-In does. Seasonals Plug-In takes the price action over the last 20 years, puts it into an Indicator and tells us over the last 20 years whether the prices during this period of time in the year, are generally up or down.

That's a very important thing for us to know, because we don't want to be bucking the seasonal trend. If generally the prices of wheat are up at this time of year, because they're susceptible to destruction's at this time of year. Then, we need to be aware of that. Or if prices generally go down, this time of year, because it's the harvest time of year, and there's a glut or overabundance of grain on the markets and nobody wants to pay a high price for it, and that pushes the prices down-we need to know when that time of period is. That's what the Seasonals Indicator does for us.

Now, I'm going to show you how it works, when you have a Seasonal Indicator it gives you two buttons down here at the bottom. I want to show you this first one, here, now. This is the Seasonals Button and you press that. You'll notice that the defaults have it come up with a blue model and a red model. The first line, the red line, you'll notice is 15 years. That's the last 15 years average of what the market has done. Notice, that it has a tendency to go up during this time of year. It has a tendency to go down during this time of year. Then, it goes a little bit flat and wobbly, through this time of year, but then it has a gentle uptrend during this time of year.

You'll notice that the one year that the blue marker, which is set to just last year. What did it do last year, is just one year's average. Is set that during this time of year last year, it was going up.

Now, let's go up into our Control Panel, because we have a number of different settings that we can change. It's under the My Default Settings. So, we come under here and you'll see your Seasonals in here, again, if you have the Plug-In, you'll have this little button, right here. If you don't have the Plug-In, then it won't be there.

If you click on it, you'll notice that you then have 3 different sections for the different parts of this Indicator. The first one is what we were looking at before, down in the bottom window, we had that set to 1 year. I'm going to come in and I'm going to change that. I'm going to change it to 10 years. I'm going to go to Apply To All Active Charts, so it changes my chart. I want to display these.

And apply to all active charts, there we go! I've turned that on to 10 years, and 15 years. Blue, solid color is my 10 year mark. My red line is the 15 year trend. So, I want to go back, I want to fill background, and on the trend, 1, and on the Scale Seasonal to the last 12 months. Because the last 12 months are the most important, to me. It's set on a 0-100 scale, that's this first part of the Indicator.

Now let's apply to all charts, go back out and take a look at it. There we go! So, this is what the Seasonal market has a tendency to do during this time of year. During this time of year, during April to July, Wheat has a tendency to go down in price. Of course, this year, this is the 2003, December contract, it did just that. Then, on this time of year, we start around July at the bottom, and we start going up, mid October to end of October first of November, we see price increases. Notice, there in September we have a little bump. That's happened every year, for the last 10 to 15 years. We see how that corresponds right up here, in the overall market trend, okay?

But that's what the Seasonals Indicator does for us. This bottom one is an Indicator set on a 0-100 scale and it helps us know the traditional trends of these markets.

Now, I want to come back in and turn on the Historical Averages. Now, let's come back into our Control Panel, go back down to our Seasonals, and this is the Historical Averages Setting. What I like to do, is I like to set it so that they are set to 1 year, that's the red line. The red line is 1 year, so that just tells us the average of 1 year. So, that just means last years prices. Because I like to see last years prices laid right over the top of this year's prices, so I can see where prices were last year, at this exact same time.

Also, average 2 is the last 3 years. So, if I want to see the last 3 years prices, on an average, where they were over the last 3 years- In comparison to this year. That's the green line. So, let's go ahead and hit Okay.

Let's come and look at this. The red line, again, was last years prices. What were last years prices doing last year at this time?

Now, look at this! Last year at this time, if we come right to this point here, we play the chart back. Last year at this time, prices started to increase, and peaked out, right around mid-September. Now, this is this years prices. If we play that forward, I'm just going to turn on the Play Controls. Now, you watch that market, how it interesting it is, how it compares to this year vs. last year. Isn't that interesting?

We broke a little early on this one, compared to last year. Last year we went a little bit higher, and we waited a little bit longer. But this year, we broke a little earlier. So, but we went up, we started up through this trend, and isn't that interesting to see how they correspond to each other?

Now, look at the 3 year average. That was the green line. So, it's going to be flattened out a little bit because we didn't take out some of the humps and the bumps, because it's determined on an average of the last three years. But we still see this bump, right here, showing that over the last three years, we've had some kind of increase in price during this time of year.

That's very important for us to know. So, that's why we've integrated into Track 'n Trade Pro.

One more section in the, that comes with the Seasonals Plug-In. Is the.......... Market Probability. Now, we set this back to 20 years. I'm going to come in here and I'm going to show you the Market Probability. What we do with the Market Probability Button, is we turn that on.

Then, it tells you the likelihood that over the last 20 years, on an individual day to day basis, whether this day closed up or closed down. So, that's what this is, over the last 20 years, there's a high probability on this day that it will close up. On this day, there's a high probability that it will close down. Okay?

So, you can see a trend, right through here. You can see 3 days in a row, where markets have a tendency to close down, down, and even more likely that they're going to close down. That's what the probability Indicator is, it's just simply telling you on a day to day basis, the probability that over the last 20 years, of whether markets have been closing up or down on that particular day.

That's just a quick introduction to our Seasonals Plug-In, I hope you enjoy it!