Successful Commodities Trading
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Transcript of Successful Commodities Trading
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Even the beginner can engage in successful commodities trading.
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Traders can make money in successful commodities trading by choosing commodities that they have an interest in and knowledge of.
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Commodities traders can use technical analysis tools such as Candlestick chart analysis to track and predict price changes in a given commodity.
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Successful commodities trading comes down to combining technical analysis with fundamental analysis.
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A good place to gain a firm knowledge of the fundamentals of commodities trading is with Commodity and Futures Training.
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Once traders have learned the fundamentals of trading commodities they will choose a commodity to trade such as oil futures or gold futures.
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Those with an agricultural background or interest may consider live cattle commodity trading or corn futures.
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Discipline, a trading strategy, and attention to detail will convert knowledge and commodity price patterns into profits for the hard working trader.
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The list of commodities to trade is long. Corn, mini-corn, corn swaps, corn calendar spread options, distiller’s dried grain futures, wheat, mini-wheat, wheat swaps, wheat calendar spread, soybean, min—soybean, soybean swaps and so forth is how the Nymex list of commodities products starts.
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Metals traded include industrial metals such as copper futures and precious metals with some industrial use such as gold and platinum.
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Energy products include crude oil futures as well as natural gas futures, coal futures, and energy credits.
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For successful commodities trading it is important to have a strong working knowledge of ones own traded commodities.
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It is always important to remember that the biggest traders in the commodities markets include the producers, processors, and commercial and industrial buyers of commodities.
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These companies are hedging their investment risk in buying and selling commodities.
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Having only a passing knowledge of a commodity that you are trading puts you at a distinct disadvantage compared to someone with a background in the industry in question and decades of trading experience.
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Despite the fact that traders are working in markets where the biggest players are experts it is absolutely possible to be successful in commodities trading.
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Part of why traders are successful is that they learn each commodity that they trade very well.
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They learn the Candlestick pattern formations in current trading and in the past.
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They follow the appropriate information sources to stay current on fundamentals.
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And, they get to choose which commodities to trade.
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A wheat trader working for a multinational grain company may work to hedge his company’s investment risk in grains but will likely not be trading gold futures, silver futures, platinum, or palladium.
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The wise trade will be knowledge across several commodities and will be able to trade where the action is or avoid markets that are so volatile as to be dangerous.
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Successful commodities trading can often come from trading the right commodities at the right time as much as from technical skill.
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Anyone successful in commodities trading is always a student of the art of trading and a student of the commodities that he or she trades.
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A successful trader maintains a keen interest in just how a successful trade came about and how an unsuccessful trade happened.
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Experience leads to success and failure. Reviewing Candlestick chart formations, becoming a student of Commodity market history, and always working to improve a commodity trading system by review of produces results.
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Learning from experience leads to successful commodities trading.