subject: Commodities Trading The Definitive Guide [print this page] Trades can look at copper demand is stronger in the Spring for the start of the building season. Gas commodities trends are higher in the summer seasons for vacation and tapers off when the summer ends. Gold and precious metals are stronger in the holidays and June as the wedding season starts. These patterns happen nearly every year.
Traders need to know that this does not work all the time but this will put the percentages in your favor. Many commodities patterns happen every year you just need to do some research before you trade commodities.
Traders need to watch their charts to qualify the trade's relative strength. What time of year it is and if trading grain,wheat,corn what the weather patterns are. You should know that there is better than an eighty five to one hundred percent chance that the seasonal will work again. Just be aware of outside forces such as weather, war, labor strikes.
There are many seasonal patterns going on in many of the Commodity markets at any given time of the year. So when you see a pattern approaching make sure of the fundamentals before placing the trade and use proper stop losses.
Relative Strength is not the indicator RSI that can be found on many trading platforms. This Relative Strength is the measure of strength and weakness in relative terms between commodity contracts. Make sure you set up your charts on a daily or weekly pattern, this is not day trading but swing trading the commodities.
You are looking for markets that are showing strength so you may buy those contract months and ones that are showing weakness so we may short those contract months.
