Tag : commodities

Can Moving Averages Predict Trend ?
Can Moving Averages Predict Trend ?

How Can You Use Moving Averages To Your Advantage? A simple moving average is calculated by adding the closing price of a commodity such as crude oil for a number of time periods and then dividing this total by the number of time periods. Short-term averages respond quickly to changes in the price of the underlying commodity, while long-term averages…

What Is Over Trading ?
What Is Over Trading ?

TRADING THEORY–– If you follow this rule you will have a chance of being successful over the course of time, if you don’t follow this rule you will be sure to lose your money quickly. This rule is simple Do Not OVERTRADE EVER for this is an easy way to lose all your capital quickly. My definition of over trading…

Chart Structure Is Very Important
Chart Structure Is Very Important

What do I mean when I talk about chart structure and why do I think it’s so important when deciding to enter or exit a trade? I define chart structure as a slow grinding up or down trend with low volatility and no chart gaps. Many of the great trends that develop have very good chart structure with many low…

What Is A Head & Shoulders Bottom ? Look At Platinum
What Is A Head & Shoulders Bottom ? Look At Platinum

Head and Shoulders Top or Bottom–-This technical indicator consists of a left shoulder, a head, and a right shoulder and a line drawn as the neckline and occur in many different daily charts over the course of time. The left shoulder is formed at the end of an extensive move during which volume is noticeably high. This type of indicator…

Here Is My Consolidation Theory
Here Is My Consolidation Theory

How long does a meaningful consolidation has to last before you enter a trade ? In my opinion I always want to see a consolidation that lasts at least 8 or more weeks before I would consider entering. The reason that I want a longer consolidation is to try and avoid a bunch of false breakouts such as a 10…

Limit Up/Limit Down Trading Theory
Limit Up/Limit Down Trading Theory

TRADING THEORY—This is an outstanding rule to understand as when a market trades limit down such as what cotton did in today’s trading session that tells you there is a high probability that prices will open lower on the open in tomorrow’s trading session as buying limit down is a fool’s game. Remember when a market closes limit down there…

Never add to a losing position !
Never add to a losing position !

TRADING THEORY—This rule is extremely important and I witness it being abused constantly creating tremendous loses that are sometimes difficult to come back from. Never add to a losing position because if the position continues to go against you and now you have added even more contracts which are all losing money your account will suffer loses much more than…

Are You A Trend Follower ? Look At Soybeans & S&P 500
Are You A Trend Follower ? Look At Soybeans & S&P 500

TRADING THEORY—Trade with the short term trend, as the saying goes in futures trading the trend is your friend but sometimes you will be a market that is trending higher and then has a false breakout to the upside and then suddenly sells off causing you a 2% loss on your equity and you say to yourself that was a…

What Is A Rounding Top Chart Pattern ? Look At Cotton
What Is A Rounding Top Chart Pattern ? Look At Cotton

What Is A Rounding Top Chart Pattern ? A chart pattern used in technical analysis which is identified by price movements that, when graphed, form the shape of an upside down “U”. A rounding top may form at the end of an extended upward trend and indicates a reversal in the long-term price movement. The pattern can develop over several…

What Is The RSI Oscillator ? Look At Soybeans
What Is The RSI Oscillator ? Look At Soybeans

TRADING THEORY —-What Is The RSI Oscillator ? —The RSI oscillator ranges from 0 to 100 and when a commodity is deemed to be at overbought levels when the RSI approaches the 70 level and beyond meaning if the oscillator has an overbought condition of 92 that is higher and even more of an overbought condition then the 70 level…