Commodity Price Trends

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Commodity Price Trends

The ability to predict commodity price trends has made a number of traders rich. There are two ways to predict commodity price trends; they are by fundamental and technical analysis of the commodities involved. Analysis and prediction of longer term commodity trends requires a basic knowledge of each commodity traded and attention to the details that affect commodity prices. It comes down to long term trading supply and demand. Technical analysis for short term trading of commodities relies upon the fact that commodity price patterns repeat themselves. It is the nature of any equity market to come to a consensus with time. However, in doing so, the path is seldom straight. Commodities markets fluctuate up and down in establishing commodity price trends. Commodity prices also fluctuate in predictable ways before a market reversal. Learning to trade both long term and short term factors is a key to commodity trading success. Starting with Commodity and Futures Training the beginning trader will establish the basis for years of successful commodities trading.

It has been hundreds of years since rice traders in Japan as well as tulip bulb traders in Holland started making sense of commodity price trends. Traders kept records of price patterns and did the first types of trend analysis. They were able to understand that before entering into a price trend a commodity would go through a number of price patterns that were repetitive and highly predictive. Candlestick analysis of Candlestick pattern formations led to successful Candlestick trading tactics that made traders rich in the days of the Samurai. These technical analysis tools are still used and still effective today in predicting commodity price trends as well as breakouts from trends. Traders need to understand market fundamentals in order to understand the potential range in which a commodity will trade and its likely eventual price. The trader who is trading oil futures , corn futures, gold futures, or virtually any futures will need to understand a different set of fundamentals but the mechanics of the commodities markets and how traders trade are the same in each of these arenas. Learning the basics of technical trading, Candlestick basics, will allow the trader to stay a step ahead by letting the market say what the market will do.

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Commodity Price Trends

  1. 1. Commodity Price Trends By www.CandlestickForums.com
  2. 2. The ability to predict commodity pricetrends has made a number of traders rich. www.CandlestickForums.com
  3. 3. There are two ways to predict commodity price trends; they are byfundamental and technical analysis of the commodities involved. www.CandlestickForums.com
  4. 4. Analysis and prediction of longer term commodity trends requires a basicknowledge of each commodity tradedand attention to the details that affect commodity prices. www.CandlestickForums.com
  5. 5. It comes down to long term trading supply and demand. www.CandlestickForums.com
  6. 6. Technical analysis for short term tradingof commodities relies upon the fact that commodity price patterns repeat themselves. www.CandlestickForums.com
  7. 7. It is the nature of any equity market to come to a consensus with time. www.CandlestickForums.com
  8. 8. However, in doing so, the path is seldom straight. www.CandlestickForums.com
  9. 9. Commodities markets fluctuate up anddown in establishing commodity price trends. www.CandlestickForums.com
  10. 10. Commodity prices also fluctuate in predictable ways before a market reversal. www.CandlestickForums.com
  11. 11. Learning to trade both long term andshort term factors is a key to commodity trading success. www.CandlestickForums.com
  12. 12. Starting with Commodity and Futures Training the beginning trader willestablish the basis for years of successful commodities trading. www.CandlestickForums.com
  13. 13. It has been hundreds of years since rice traders in Japan as well as tulip bulbtraders in Holland started making sense of commodity price trends. www.CandlestickForums.com
  14. 14. Traders kept records of price patternsand did the first types of trend analysis. www.CandlestickForums.com
  15. 15. They were able to understand that before entering into a price trend acommodity would go through a number of price patterns that were repetitive and highly predictive. www.CandlestickForums.com
  16. 16. Candlestick analysis of Candlestick pattern formations led to successful Candlestick trading tactics that madetraders rich in the days of the Samurai. www.CandlestickForums.com
  17. 17. These technical analysis tools are still used and still effective today inpredicting commodity price trends as well as breakouts from trends. www.CandlestickForums.com
  18. 18. Traders need to understand marketfundamentals in order to understand the potential range in which a commodity will trade and its likely eventual price. www.CandlestickForums.com
  19. 19. The trader who is trading oil futures ,corn futures, gold futures, or virtually any futures will need to understand a different set of fundamentals but themechanics of the commodities marketsand how traders trade are the same in each of these arenas. www.CandlestickForums.com
  20. 20. Learning the basics of technical trading,Candlestick basics, will allow the trader to stay a step ahead by letting the market say what the market will do. www.CandlestickForums.com
  21. 21. During commodity price trends theprices of commodities or commoditiesfutures will not move up or down in a straight line. www.CandlestickForums.com
  22. 22. Those mostly interested in long term investing in a given commodity willtypically buy or sells futures contractsbased upon their analysis of the price trend. www.CandlestickForums.com
  23. 23. They will wait until the trend plays itself out or the contract is ready to expire before exiting the trader. www.CandlestickForums.com
  24. 24. A day trader with a shorter term focus will typically buy and sell futures contracts during the course of the trends, using trend analysis to guide their purchases and sales. www.CandlestickForums.com
  25. 25. By following commodity price trends traders can profit from both their fundamental analysis of commoditysupply and demand aspects and from their technical commodity analysis ofshorter term market moves within the prevalent trend. www.CandlestickForums.com

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