Futures price


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Futures price

  1. 1. Futures PriceBy: www.CandleStickForums.com
  2. 2. A futures price in commoditytrading is the price onwhich commodities traders agreefor a commodity futures contractat a given commodity deliverydate. The futures price may varysignificantly from the currentmarket price, the spot price, for thecommodity.By: www.CandleStickForums.com
  3. 3. The futures price of a commodity isdetermined by the market’sassessment of commodity supplyand demand in the coming monthsand years. Traders will useboth fundamentalanalysis and technical analysis inorder to predict prices and guidetheir trading in commodities.By: www.CandleStickForums.com
  4. 4. In beginning commodity futurestrading traders will be well servedby taking Commodity and FuturesTraining. This training will beuseful for beginners and seasonedtraders.By: www.CandleStickForums.com
  5. 5. Developing skill in the useof Candlestick analysis will helpthe trader anticipate futures pricemovements and profit from theinherent variability of commodityprices.By: www.CandleStickForums.com
  6. 6. Futures price variability is based onprojected supply and demand.Eventually the commodity price,the spot price, will be determinedprecisely by supply and demand.By: www.CandleStickForums.com
  7. 7. In futures trading of commoditiesthe use of technical analysistools such as Candlestick patternformations will help the traderanticipate the market’s reactions tochanges infundamentals. Candlestickpatterns have been used forcenturies of commodities trading.By: www.CandleStickForums.com
  8. 8. Because patterns are repetitiveboth market trends and marketreversal can be predicted with agreat deal of accuracy. Using thesetools made rice traders rich inancient Japan and can profit thetrader in commodities today aswell.By: www.CandleStickForums.com
  9. 9. In trading the commodity futuresof oil futures, gold futures, cornfutures, or in live cattle commoditytrading traders will need to watchcommodity news reports and thecurrent NYMEX commodityfutures price. This is partof fundamental commodityanalysis.By: www.CandleStickForums.com
  10. 10. The point is, obviously, toanticipate changes in the futuresprice of a given commodity. Thetrader can buy commodity futuresand sell commodity futures at anypoint during a futures contract upuntil the delivery date.By: www.CandleStickForums.com
  11. 11. Therefore it is possible to profitfrom variation in the futures priceof a commodity even if it onlytakes place over a few days. Stayingcurrent with market fundamentalswill put the trader in the rightcommodity market at the righttime.By: www.CandleStickForums.com
  12. 12. Analyzing Candlestick patternformations will help the traderexecute trades at the mostopportune time for both buyingcommodities and sellingcommodities.By: www.CandleStickForums.com
  13. 13. Commodities markets are made up ofmany traders with many opinionsregarding the same fundamentalinformation. The sum total of theirtrades tends to be repetitive and fallsinto patterns. Successfully using thisinformation is the essence ofsuccessful Candlestick trading tactics.By: www.CandleStickForums.com
  14. 14. Another means of trading thefutures price of a commodity isby trading options. A trader canbuy or sell calls or puts oncommodity future contracts.By: www.CandleStickForums.com
  15. 15. As with all options trading thetrader who buys calls or put ispurchasing the option to buy (witha call option) or sell (with a putoption) a futures contract at anagreed upon price, the strike price.By: www.CandleStickForums.com
  16. 16. Unlike with buying or sellingfutures the purchaser of options isnot obligated to carry throughunless conditions are profitable. Auseful course for learning aboutoptions trading commoditiesis Options Training with StephenBigalow.By: www.CandleStickForums.com
  17. 17. Market DirectionBy: www.CandleStickForums.com
  18. 18. What is the major advantagecandlestick investors have overother technical traders? They cansee what is actually occurring ininvestor sentiment now! Whenanalyzing the market trend, thereis a very simple process for havinga relatively accurate feel for whichdirection the market is moving.By: www.CandleStickForums.com
  19. 19. What is the most powerful aspect ofcandlestick analysis? The signalsthemselves! The Japanese Rice tradersspent hundreds of years observing,analyzing, and utilizing the signalsprofitably. The assumptions are verysimple. Witnessing a bullish signal inthe oversold conditions as anextremely high probability ofindicating a reversal is about to occur.By: www.CandleStickForums.com
  20. 20. Friday, the Dow experienced aBullish Engulfing signal in theoversold condition. This wasfollowing a Doji two days prior.Both of these signals wereproviding indications the Bullsmight be trying to bottom themarket.By: www.CandleStickForums.com
  21. 21. However, another simple indicatoris the T-line. The simple rule fortrend analysis is the trend willremain in progress until theappearance of a candle reversalsignal and a close above the T-line.By: www.CandleStickForums.com
  22. 22. DOW
  23. 23. By: www.CandleStickForums.com
  24. 24. Todays trading made it obviousthe Bulls did not have enoughstrength to push the marketthrough the tee line. Whatassumptions can be made? Thedowntrend is still in progress.By: www.CandleStickForums.com
  25. 25. And the assumption can be madethe Bulls are starting to step in inthis area. The downtrend is still inprogress! Fridays bullish signal wasnegated today. The strategybecomes very simple.By: www.CandleStickForums.com
  26. 26. Live CattleBy: www.CandleStickForums.com
  27. 27. By: www.CandleStickForums.com