Monthly Forex Seasonality – November 2021: Good for US Stocks, Bad for Gold

November FX Seasonality Overview:

• The second-to-last month of the year typically invites great returns for US stocks, while leaving gold prices lower and the US Dollar trading sideways.
• November is actually the best month of the year for the US S&P 500, for both the 5- and 10-year look-back periods.
• Commodity currencies tend to fare well during November, but the British Pound likewise tends to see some of its best performance during the year.

The beginning of the month warrants a review of the seasonal patterns that have influenced forex markets over the past several years. For November, our focus is on the trailing 5-year and 10-year performances, both of which fully capture trading during the era of quantitative easing and expanding government deficits since the 2008/2009 Global Financial Crisis – not dissimilar from the environment we find ourselves in during the coronavirus pandemic recovery.

Monthly Forex Seasonality Summary – November 2021

Forex Seasonality in Euro (via EUR/USD)

November is a bearish month for EUR/USD, from a seasonality perspective. Over the past 5-years, it has been the fifth worst month of the year for the pair, averaging a loss of -0.02%. Over the past 10-years, it has been the third worst month of the year, averaging a loss of -0.74%.

Forex Seasonality in British Pound (via GBP/USD)

November is a bullish month for GBP/USD, from a seasonality perspective. Over the past 5-years, it has been the best month of the year for the pair, averaging a gain of +1.32%. Over the past 10-years, it has been the fifth best month of the year, averaging a gain of +0.10%.

Forex Seasonality in Japanese Yen (via USD/JPY)

November is a very bullish month for USD/JPY, from a seasonality perspective. Over the past 5-years, it has been the best month of the year for the pair, averaging a gain of +1.96%. Over the past 10-years, it has been the best month of the year, averaging a gain of +2.43%.

Forex Seasonality in Australian Dollar (via AUD/USD)

November is a mixed month for AUD/USD, from a seasonality perspective. Over the past 5-years, it has been the fifth best month of the year for the pair, averaging a gain of +0.35%. Over the past 10-years, it has been the fourth worst month of the year, averaging a loss of -0.58%.

Forex Seasonality in New Zealand Dollar (via NZD/USD)

November is a bullish month for NZD/USD, from a seasonality perspective. Over the past 5-years, it has been the second best month of the year for the pair, averaging a gain of +2.1%. Over the past 10-years, it has been the sixth best month of the year, averaging a gain of +0.31%.

Forex Seasonality in Canadian Dollar (via USD/CAD)

November is a mixed month for USD/CAD, from a seasonality perspective. Over the past 5-years, it has been the seventh worst month of the year for the pair, averaging a loss of -0.04%. Over the past 10-years, it has been the fourth best month of the year, averaging a gain of +0.62%.

Forex Seasonality in Swiss Franc (via USD/CHF)

November is a bullish month for USD/CHF, from a seasonality perspective. Over the past 5-years, it has been the fifth best month of the year for the pair, averaging a gain of +0.18%. Over the past 10-years, it has been the third best month of the year, averaging a gain of +0.9%.

Forex Seasonality in US S&P 500

November is a very bullish month for the US S&P 500, from a seasonality perspective. Over the past 5-years, it has been the best month of the year for the index, averaging a gain of +4.43%. Over the past 10-years, it has been the best month of the year, averaging a gain of +2.73%.

Forex Seasonality in Gold (via XAU/USD)

November is a very bearish month for gold (XAU/USD), from a seasonality perspective. Over the past 5-years, it has been the worst month of the year for the precious metal, averaging a loss of -3.21%. Over the past 10-years, it has been the second worst month of the year, averaging a loss of -2.7%.

— Written by Christopher Vecchio, CFA, Senior Strategist