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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.

During commodity price trends the prices of commodities or commodities futures will not move up or down in a straight line. Those mostly interested in long term investing in a given commodity will typically buy or sells futures contracts based upon their analysis of the price trend. They will wait until the trend plays itself out or the contract is ready to expire before exiting the trader. 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.

By following commodity price trends traders can profit from both their fundamental analysis of commodity supply and demand aspects and from their technical commodity analysis of shorter term market moves within the prevalent trend.



Market Direction:  Candlestick signals make for a very simple if/then analysis. The Dow came up to the 50 day moving average last week and formed a couple Doji's. This produced a simple analysis. We know the trend will move in the direction of how they open prices after a Doji. Friday required a positive open to indicate the bullish trend was still in progress. This would also have indicated the 50 day moving average would not be acting as resistance. However, the premarket futures on Friday morning showed weakness in the markets. A weak open provided a new set of information. The 50 day moving average was continuing to act as resistance. The downtrending channel was still in progress. Stochastics in the overbought condition, starting to roll over, was additional confirmation the uptrend was failing and it was time to go short.

DOW

Having the visual analytical tools to apply, along with the candlestick signal, makes trend analysis very easy. The lower open on Friday made was an immediate instigation to close out any long positions that were looking weak and establishing short positions/short funds. Knowing what the trend would probably do upon a lower open allowed for closing positions immediately. This eliminates the emotional questioning most investors get involved with when they do not take action on a position at the appropriate time. It is not uncommon for a price to open lower and then continue lower with an investor thinking, "why did I not close that on the open like I should have?" The next thought process is waiting to see if there is going to be another bounce up so the position can be closed out at a better price. That thought process continues as the price keeps going lower. Or the price does bounce back up and the thought process now becomes to hold the position because it may be going back up. Candlestick signals have specific results based upon how they open and move. Knowing what should be done at the appropriate time allows for much more decisive and profitable trading.

BAC

Private training sessions - "Why would I need to do a private training session if I have already done the basic training and the boot camp?" This is a very good question! A private training session has different dynamics than an online webinar or a live seminar with 20 or 30 people. The questions you have in your mind are probably not going to be asked under those conditions. That means any additional information you receive from the point where you are unsure of something does not have a concrete effect of learning the trading process. You will not see charts that are any different during the private training session then you would during an online training webinar. However, what ever aspect of the chart analysis that was not fully clear in your mind will be addressed until you understand it completely. When you finish a private session training, you will understand candlestick analysis completely. That creates a completely different perspective for future trading. You now can go forward knowing that you have learned and understood candlestick analysis to the fullest extent. From that point, you will not be making trade decisions with the idea you are still learning and gaining experience, you will be investing based upon knowing all the aspects found in candlestick signals and trying to improve upon them.

You will gain a different perspective when all your questions about investing become fully clarified. You can now move forward with the idea that you want to improve the trading system to fit your investment style andn nature. Learning how to invest correctly is not merely reading books and watching chart analysis. Profitable investing involves knowing in your own mind that you have all the knowledge about a trading system. From there, each investor can produce the trading strategy with confidence, the confidence required to execute trades at the appropriate times without second-guessing. If you have a good understanding of candlestick signals and they're confirming indicators, but you are still not making the big profits you have expected, you need to dig into your own psyche and discover what is holding you back. The Candlestick Forums Private Training Sessions are designed to obtain the full comprehension of the common sense aspects of candlestick analysis.

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