Should the recognition of Octobers as a disaster area affect your E-Mini Trading Strategy?

The press began its annual warnings and predicted that October was a dangerous month for e-commerce. As a positive proof of the impending doom, they reduce the October 1987 market crash. Yes, the drums of material destruction and economic catastrophe are struck by an impressive pattern based on this devastating week of October 1987. Are these warnings, in fact, or are examples of “news creation” with questionable accuracy? To evaluate October’s performance in the years since 1987, let’s look at the history and link it to potential issues in e-commerce, especially day trading and e-mini scalping.

From the outset, I must say that I believe that past tragedies have not been a drastic change in e-commerce strategy. On the other hand, rejecting any risk altogether in October will be reckless and counterproductive in my e-mini trading strategy. Benoit Mandelbrot’s discussion of “market misbehavior” and “long tail” events is proof that any changing horoscope can create unexpected trading action; Hundreds of variables in market price discovery are difficult to analyze and generally persist, surprising and confusing both economists and traders with their randomness and coverage, which are not identified (or correctly interpreted) as market crashes. Commodity and Futures Exchange from NYSE since it tends to create higher variability, this refers to a much higher degree of impact. , CME and other futures exchanges, you would expect price volatility to be expressed more deeply in the price action.

Let’s take a look at the annual results in the Dow Index to determine if October is a risky month for trading, as my personal preferences are on the table. The results can be found in the in-depth “Alpha Search” blog and Dow Jones data:

· In the last five years, the Dow has advanced four years without falling

· In the last decade, the Dow has advanced six years without falling behind

· The Dow has advanced eleven years without falling behind in the last fifteen years

· Over the past 15 years, the Dow has advanced an average of 1.76% in October.

Source: Search the Dow Jones and Alpha blog

In the past, there was only one year (2008) that saw a significant decline in price levels. He experienced a 14.06% decline in the Dow that year; I would characterize this figure as the result of a banking / credit crisis, and I would not particularly refer to October, as previous data showed that October was not an extremely dangerous month for e-commerce. The data confirms that in the last fifteen years, October has not been a dangerous month, not even a statistically significant month for dangerous trading conditions.

In summary, I don’t think October is a difficult month to trade compared to other months of the year; In fact, data suggests that October could be a good month for e-commerce. However, the October 1987 incident remains a psychological barrier for traders and, as it turns out, is far from being forgotten. As always, good luck with your business …