I was watching the news the other day and noticed something missing from the Bloomberg segment.

Their “BCOM” seasonality chart shows you the average monthly return for the Bloomberg Commodity Index over a specified time frame (typically one to five years).

But it doesn’t give you what you actually need to trade, like the strongest sectors, the top movers, or the stocks to avoid at all costs.

So today, I’m going to go one layer deeper.

Here are the three names that should be on your radar this summer.

D.R. Horton Gets the Ball Rolling

The first place I’m looking this month is real estate.

Beginning around July 6, homebuilders consistently start moving toward the top of my bullish seasonal rankings. When I ran this year’s scan, D.R. Horton (NYSE:DHI) was one of the first names that jumped off the screen:

Over the last 10 years, D.R. Horton has produced this seasonal pattern in nine of those years. The move has typically lasted about 39 trading days and generated an average gain of roughly 16%, even after including the one losing year. 

Think about that for a second.

That’s not one great trade – that’s a pattern that’s repeated itself almost every summer for an entire decade.

Now, does that guarantee D.R. Horton moves higher this July? Of course not.

History never guarantees anything.

But when I see a stock doing the same thing nine times out of ten, I’m going to pay attention.

Another thing I like about this setup is the timing. Since this pattern typically lasts around 39 days, I already have a pretty good idea of how long I expect the opportunity to play out. 

And for options traders, that’s valuable because it helps you focus on expiration dates instead of simply guessing how long a move might take.

Lowe’s Could Be Ready for Another Summer Run

The next opportunity doesn’t begin until a little later.

Around July 15, consumer stocks begin showing up across my scans, and Lowe’s Companies (NYSE:LOW) is one that has consistently earned a spot near the top of the list:

This particular seasonal pattern has also repeated in nine of the last 10 years. In fact, you’d have to go all the way back to 2016 to find the last time this setup didn’t work. 

And that’s the kind of consistency I like seeing.

Now, the stock itself hasn’t exactly been on a straight ride higher this year. It’s been making lower highs and lower lows for much of the year before recently bouncing from support.

So, the question becomes: Could July’s seasonal strength help carry that bounce into August?

Maybe. Maybe not.

But this is exactly why I follow repeatable patterns instead of headlines.

In fact, I have a tool I call the Power Meter, and it’s simply a way for me to measure whether a seasonal pattern is actually improving over time.

A stock that had a great pattern 10 years ago but has gradually weakened isn’t nearly as interesting to me as one that’s becoming more reliable.

That’s what I’m looking for – and LOW continues checking those boxes.

But Not Every Seasonal Trade Is Bullish

Now here’s something a lot of traders overlook: not every seasonal opportunity is a buying opportunity.

Sometimes the best trade is simply knowing what to avoid. And sometimes, the seasonal edge actually points lower.

That’s exactly what shows up near the end of July.

Beginning around July 31, several consumer staples stocks begin flashing bearish seasonal patterns. One of the strongest examples this year is Philip Morris International (NYSE:PM):

Over the last decade, this bearish pattern has repeated in nine out of 10 years, with weakness typically lasting well into early fall. 

I actually like seeing bearish patterns in my scans because they remind me that the market doesn’t always hand us buying opportunities.

Sometimes avoiding the wrong stock can be just as valuable as buying the right one.

And if you’re someone who trades both sides of the market, those bearish seasonal tendencies can become opportunities of their own.

Putting It All Together

To sum everything up, the Bloomberg chart will tell you what the market has historically done in any month.

But while that’s useful, I think the more valuable question is: Where are those returns really coming from?

That’s the difference between looking at averages and looking at opportunities.

And right now, the three names at the top of my July watchlist are DHI for early-month strength, LOW for a bullish setup beginning in mid-July, and PM for a bearish pattern that historically develops near the end of the month.

Will every one of these patterns repeat perfectly this year?

We’ll find out. 

But after spending decades studying seasonal trends, I’ve learned to never try predicting the market. Instead, simply follow the patterns that have repeated themselves over and over again, year after year. 

That’s  where some of the best opportunities are – and where things start getting interesting.