January is shaping up to be an unusual month. It definitely underperforms compared to the Monthly Strategy as a whole, with one odd exception. Take a close look at the risk v. reward chart below and you will see near parity between January and the overall winning history at a 40% target profit.
This is a really beguiling setup that can be explained in two parts: First, January has fewer data points than most months and less data means more erratic trend lines. Second, and perhaps more importantly, it seems there is a threshold, or glass ceiling, for monthly plays executed in January. Once a trade breaks north of the 30% mark, it is much more likely to hit 40% (but just).
While this month may seem challenging, experienced members will know to concentrate on the lower end of our target guidelines to lock in profits.
