Crude oil often bottoms in mid-February and then uptrends through the end of April. It is that early February break that can give traders an edge by buying low in a seasonally strong period. Over the last 28 years, this trade has worked 24 times for an incredible 85.7% win ratio.
Seasonal influence that causes crude oil to move higher in this time period is partly due to continuing demand for heating oil and diesel fuel in the northern states and partly due to the shut down of refinery operations in order to switch production facilities from producing heating oil to reformulated unleaded gasoline in anticipation of heavy demand for the upcoming summer driving season. This has refiners buying crude oil in order to ramp up the production for gasoline.
The February seasonal play in Oil is something every trader needs to add to his play book.