April FX Seasonality Overview:
- By some measures, April has been either the best or second best month of the year for EUR/USD and GBP/USD rates, as well as the S&P 500.
- April showers? ‘Terror rains’ down on the greenback: over the past 10-years, April has been the worst month of the year for the US Dollar (via the DXY Index), averaging a loss of -1.09%.
- Gold prices have been performing well in April, with gains averaging +2.39% over the past 5-years and +1.4% over the past 10-years.
The beginning of the month warrants a review of the seasonal patterns that have influenced forex markets over the past several years. For April, 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 – April 2021
Forex Seasonality in Euro (via EUR/USD)
April is a bullish month for EUR/USD, from a seasonality perspective. Over the past 5-years, it has been the sixth best month of the year for the pair, averaging a meager gain of +0.04%. Over the past 10-years, it has been the best month of the year, however, averaging a gain of +1.2%.
Forex Seasonality in British Pound (via GBP/USD)
April is a very bullish month for GBP/USD, from a seasonality perspective. Over the past 5-years, it has been the third best month of the year for the pair, averaging a gain of +0.91%. Over the past 10-years, it has been the best worst month of the year, averaging a gain of +1.72%.
Forex Seasonality in Japanese Yen (via USD/JPY)
April is a bearish month for USD/JPY, from a seasonality perspective. Over the past 5-years, it has been the sixth best month of the year for the pair, averaging a loss of -0.45%. Over the past 10-years, it has been the third worst month of the year, averaging a loss of -0.64%.
Forex Seasonality in Australian Dollar (via AUD/USD)
April is a bullish month for AUD/USD, from a seasonality perspective. Over the past 5-years, it has been the sixth best month of the year for the pair, averaging a gain of +0.21%. Over the past 10-years, it has been the second best month of the year, averaging a gain +1.18%.
Forex Seasonality in New Zealand Dollar (via NZD/USD)
April is a mixed month for NZD/USD, from a seasonality perspective. Over the past 5-years, it has been the fourth worst month of the year for the pair, averaging a loss of -0.57%. Over the past 10-years, it has been the fourth best month of the year, averaging a gain of +0.72%.
Forex Seasonality in Canadian Dollar (via USD/CAD)
April is a very bearish month for USD/CAD, 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 -0.38%. Over the past 10-years, it has been the worst month of the year, averaging a loss of -1.23%.
Forex Seasonality in Swiss Franc (via USD/CHF)
April is a mixed month for USD/CHF, 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 +1.15%. Over the past 10-years, it has been the fourth worst month of the year, averaging a loss of -0.63%.
Forex Seasonality in US S&P 500
April is a very bullish month for the US S&P 500, from a seasonality perspective. Over the past 5-years, it has been the second best month of the year for the index, averaging a gain of +3.61%. Over the past 10-years, it has been the second best month of the year, averaging a gain of 2.34%.
Forex Seasonality in Gold (via XAU/USD)
April is a very bullish month for gold (XAU/USD), from a seasonality perspective. Over the past 5-years, it has been the fourth best month of the year for the precious metal, averaging a gain of +2.39%. Over the past 10-years, it has been the third best of the year, averaging a gain of +1.4%.
--- Written by Christopher Vecchio, CFA, Senior Currency Strategist
