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Thursday, 26 November 2015
The MA (Moving Average) cannot be too hot or too cold; it needs to be just right
Moving Averages are not the Holy Grail and are not created equal; however if used systematically and consistently, they tend to keep a trader on the right side of the big moves.
They are a totally technical approach(they rely on price only) and it doesn’t matter which market you use them on. They work well in bull and bear markets and in both the stock and commodity markets; However they ‘ll whipsaw the trader in a sideways or trendless market. However, this isn’t as big of a disadvantage as it might appear at first.
Usually the trader will quit just before the big move starts.Remember that you need to catch the big moves when using a moving average system or you won’t win.
The length of the MA greatly impacts trading activity and therefore profitability.Many Traders use 5 -day MAs, Some use 10 -day MAs, others use 20 -day, many use 50 0r 100 -day and so on.
The length is an arbitrary decision,depending on the type of trader,but length directly determines the sensitivity of any MA.The lenghth determines how much time an MA has to respond to a change in price. It is a matter of lag time.This’s simple but important concept : Shorter moving averages are more sensitive than long moving averages.
Is any Easy Way to Make Money in Commodity?
Quick answer…there is no easy WAY TO MAKE MONEY IN commodity trading. Sorry about that. No get rich quick schemes. The fact is once in a while you hear of someone who made a killing in the commodity markets.
What is reality that even when you do MAKE MONEY IN the commodity markets it is a challenge to keep it. A select few do keep it and even compound their money. These are commodity trading advisors who have a plan and follow it with absolute discipline.
Too many believe that they can watch Business TV Channels and be told where the markets will go. Looking for tips is the surest way to lose money! Once a trader realizes that no one knows the future they start to mature as a commodity trader.Discipline, patience,humility,prudence,perseverance, good judgement, courage and self reliance are the traits that distinguish success. These are not easy traits to have.
It is very easy to get disgusted and give up. You have to want it. You have to want to succeed and know you will be doing this for the next 30 to 50 years of your life. This is what it takes. There is NOTHING easy in commodity trading. Experience and time help build these qualities.We have learned all along the way what it takes to be successful. It is hard work. This hard work must be done day in ..day out..and many days..months..or even longer periods of time we do notmake money. Then all of a sudden we stumble into some major move in something and make up and profit largely.
This is commodity trading or more so Trend Following. This is how it works. If done correctly potentially on average over a long period of time you can possibly attain mid teen results compounded. This is the goal. There are years which are wonderful and then there are years like this one…lack luster. It is all part of it. Stay disciplined, focused and let the possibilities and time work in your favour.
What is reality that even when you do MAKE MONEY IN the commodity markets it is a challenge to keep it. A select few do keep it and even compound their money. These are commodity trading advisors who have a plan and follow it with absolute discipline.
Too many believe that they can watch Business TV Channels and be told where the markets will go. Looking for tips is the surest way to lose money! Once a trader realizes that no one knows the future they start to mature as a commodity trader.Discipline, patience,humility,prudence,perseverance, good judgement, courage and self reliance are the traits that distinguish success. These are not easy traits to have.
It is very easy to get disgusted and give up. You have to want it. You have to want to succeed and know you will be doing this for the next 30 to 50 years of your life. This is what it takes. There is NOTHING easy in commodity trading. Experience and time help build these qualities.We have learned all along the way what it takes to be successful. It is hard work. This hard work must be done day in ..day out..and many days..months..or even longer periods of time we do notmake money. Then all of a sudden we stumble into some major move in something and make up and profit largely.
This is commodity trading or more so Trend Following. This is how it works. If done correctly potentially on average over a long period of time you can possibly attain mid teen results compounded. This is the goal. There are years which are wonderful and then there are years like this one…lack luster. It is all part of it. Stay disciplined, focused and let the possibilities and time work in your favour.
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