Light Crude fell sharply on the last trading day of October and ended the month down. Crude even poked its head above $52 twice during the month, but fell sharply the last two weeks of October and ended below $47. This reversal of fortune is especially interesting when we look at the seasonality chart for crude. October and November were the two weakest months over the last 20 years. October finished higher just 35% of the time and November finished higher 42% of the time. Moreover, the average loss was 3.1% in October and 3.4% in November. It is also interesting to note that December is not a good month for oil either. Even though crude was higher 58% of the time, the average gain was actually a loss (-1.1%).
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--Arthur Hill CMT
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