The Nile Flooded Every Year — So Does This Stock

Listen to the audio version of this article (generated by AI).

Editor’s Note: Looking back can often help us see what’s likely to happen next.

That approach has enabled Keith Kaplan and his team at TradeSmith to deliver notable investment gains for their subscribers. Instead of predicting market moves based on gut or headlines, they created a software system that looks to history to identify calendar windows optimal for investing.

For today’s Smart Money, I invited Keith to dive deeper into why patterns are important and detail multiple backtests, including one that turned every $10,000 into $85,700.

In fact, he recorded a free presentation showing the tool in action, which you can find here.

Without further ado, here’s Keith…

On Wednesday, the U.S. and Iran blew through their second ceasefire in four months.

The Strait of Hormuz — the world’s most important oil chokepoint — has now been declared open, then closed again, at least three times since February.

I’ll be the first to admit it: I didn’t see the Iran war coming, and I have no clue when it’s going to end.

I’m an ignoramus on where interest rates are going, too.

Will Kevin Warsh, the new Trump-appointed Fed boss, raise or lower rates?

I have no clue!

And don’t ask me to predict the earnings of Nvidia, Microsoft, Google or any of the other big AI players. I can’t.

And it’s not just me — nobody else can, either.

Just ask Wharton School professor Philip Tetlock. His long-running study tracking thousands of predictions from political and economic experts found that many performed barely better than chance.

Or as he famously put it, the average expert was roughly as accurate as “a dart-tossing chimp.”

That’s why at TradeSmith we don’t try to make predictions about the future. To see what’s likely coming next, we look at the past.

That includes seasonal patterns — calendar windows during which stocks have tended to rise and fall in the past with remarkable accuracy.

It’s why I tell folks to forget about interest rate announcements… earnings… macro narratives… and all the other usual reasons to buy a stock.

All the money you could ever want to make in the market boils down to just a handful of dates on the calendar. I’ll show you how it works in a moment — with an 83% historical accuracy across 5,000 stocks going back to the start of the 1990s.

First, a quick stop in ancient Egypt.

Using the Past to See Into the Future

The Nile River was the source of all life for the people of ancient Egypt. It could also be the source of death and devastation.

Every July, it flooded with astonishing regularity. And how much flooding there was determined whether Egypt feasted or starved that year.

Too little water, and crops failed. Too much, and the flood destroyed villages, swept away irrigation canals, and drowned the harvest before it could grow.

To know what was coming, the ancient Egyptians didn’t try to predict when rain would fall in the distant Ethiopian highlands and fill the Nile’s tributaries. They didn’t need to.

Instead, they built stone columns called Nilometers, sunk into the riverbank. Each column carried marks recording how high past floods had climbed, year after year, going back generations.

By reading centuries of those marks, the Egyptians knew when to plant, when to harvest, when to store grain for a lean year. Not because they could forecast the weather — but because they trusted those past patterns to hold.

As the river climbed each summer, priests marked its progression against every flood before it. If the waters were rising faster than usual, it signaled a big flood. Slower meant a drought.

By managing these rhythms, Egypt turned an unpredictable river into a reliable food supply.

Taxes, grain stores, and harvests were planned out years in advance. All built on nothing more than centuries of marks on a stone wall.

Most investors don’t know it. They’re too busy trying to peer into the future…

But like the Nile, the stock market has its own “floods” and “droughts” — times when stocks predictably surge or dry up at specific times of the year based on decades of data.

This may be news to most regular investors, but traders have known about these patterns for decades.

Traders Have Tracked These Cycles for Centuries

Commodity traders, for example, have long tracked planting and harvest cycles in crops like corn and wheat.

The gold market has also shown recurring seasonal tendencies, often strengthening during certain parts of the year tied to jewelry demand, central bank buying, and annual festivals in India and China.

And stock investors have studied seasonal phenomena such as the January Effect for decades. Even Wall Street’s old saying — “Sell in May and go away” — comes from observed seasonal behavior, not theory.

The only thing that’s changed is how precisely we can track these seasonal effects.

Today, we can discover these patterns across thousands of stocks, over decades of history, and measure them down to specific days — not just months or quarters.

That’s what my team and I set out to do at TradeSmith.

We built software to analyze more than 2 quintillion historical prices across roughly 5,000 stocks, running millions of tests to answer a simple question: Is there an optimal time of year to buy — and an optimal time to sell — each individual stock?

When we tested this approach over the past 18 years, the results were remarkably consistent.

Boston Beer (SAM), for instance, has entered a seasonal “green zone” every Oct. 6 for the past 15 years — climbing an average of 6.6% over the next 17 days:

And SAM stock rallied during that October window 100% of the time. Fifteen out of 15 years – as you can see below:

Nvidia (NVDA) has done something similar every Oct. 23, rising an average of 6.5% over the next 18 days:

NVDA climbed during that window in 13 out of the last 15 years. Even back in 2015, long before many investors had heard of the company:

None of these moves depended on a specific earnings outcome…or any other news headline. They showed up on the calendar, year after year, in bull markets and bear markets alike.

Zoom out, and the pattern holds at the portfolio level, too. A portfolio built around these calendar windows turned every $10,000 into $85,700 over an 18-year backtest.

Those are the kind of results that get your attention — especially when the world seems less predictable now than ever.

Why This Matters Now

Life in the 21st century can feel bamboozling.

We’re constantly buffeted by geopolitical shifts, economic threats like inflation, and exponential technological change — especially from AI.

But you don’t need to predict the next geopolitical shock… Fed decision… or figure out the future of AI and humanity… to grow your wealth. If professional forecasters get these calls wrong more often than not, what hope do you or I have of getting them right?

But you do need a way to understand when the odds are historically tilted in your favor — and when they aren’t. That’s what makes seasonality so valuable.

So, I urge you to watch the replay of this week’s Breakthrough 2026 event.

I walk you through how we uncovered these patterns in stocks… why seasonality keeps working even when markets feel uncertain… and how you can use our software to spot hidden seasonality trends.

I also share a free stock recommendation so you can see how this works in real time — not just in backtests.

Markets will always feel noisy. And 2026 is no exception.

To get an edge, you need to know which signals to ignore — and which patterns have been there all along, hidden in the data.

Here’s that link again to watch the replay.

Regards,

Keith Kaplan
CEO, TradeSmith