Creating Basics Commodity Trading Systems That Works
When creating your own Basics Commodity Trading Systems, there are a few things to keep in mind. Your trading strategy needs to be able to identify new Commodity Trading market trends, while at the same time making sure you don't to get faked out/whipsaws. The real trick is, once you have created a commodities system that works for you, stick to it. Being disciplined will help you a lot in becoming successful.
Before trading Commodity Trading on a live commodities trading account, you have to figure out what Basics Commodity Systems and strategies work for you. It is good to know in what time frame you are going to be working in, and how much you are willing to risk once you begin. All these factors should be factored in, and should be written down within your commodities trading plan. A good place to test this would be on a free practice trading account. This is where you test your strategies risk free without investing money to determine which strategy is best suited for you.
So, now how can a trader like you create a "good Basics Commodity Systems" or "best Basics Commodity Trading Systems "?
To come up with a good commodity strategy the first thing to do is to define your main aim or goal:
The following example illustrates a goal & explains the rules of how to achieve that goal for your Basics Commodity Trading System.
Commodities Trading Goals
1.Identify a new commodity trend
Moving average crossover method is the most commonly strategy used to identify a new trend. Time to open a long or short trade is decided when 2 averages cross over or cross under each other.
2.Confirm the new commodity trend
Relative Strength Index(RSI) and Stochastic Oscillator Indicator are the most commonly used indicators to confirm a Commodities trend.
Indicator-based Basics Commodity Trading Systems
The best type of a trading method is one that is indicator-based. You will find it straight forward to generate the signals & thus less error-prone on your part & this will help you to avoid market whipsaws.
There are several things we want to achieve when creating Basics Commodity Trading Systems :
- Find entry points as early as possible.
- Find exit points securing maximum gains.
- Avoid fake entry and exit signals.
- Proper Commodities Trading Money Management Rules
Accomplishing these 4 goals will result in a profitable Basics Commodity Trading System & a strategy that works.
The last piece of information needed, is deciding how aggressive you're going to be when entering & exiting a trade. Those who more aggressive wouldn't wait until the chart candle stick closes and would enter as soon as their indicators match up. But most would wait until the chart candlestick of the time-frame they are using has closed, to have more stability when entering a the commodities market.
To get huge profits out of the commodity market you need to build your own profitable commodity system; a method that will bring your not just hundreds but thousands of dollars worth of revenues. You need to have your own strategy that will help you achieve your financial goals. Sometimes the best trading systems are the ones that you build on your own. No need to keep searching online for best commodities trading systems or for commodities systems which work, this website provides you with all the tools required to help you and guide you on how to come up with your own commodities trading systems.
Below is example of a Basics Commodity Trading Systems based on RSI, MACD & Stochastic.
Commodity System - Basics Commodity Trading Systems
The Basics Commodity Trading Systems example above is comprised of four technical indicators in total, all of these generate Commodities trade signals using different methods, the moving average will generate signals using the crossover method shown, the RSI, Stochastic and MACD use different analysis to generate the long and short signals as shown in the above example. How to generate these trading signals is discussed in the next topic (on the sidebar navigation learn tutorials menu under key concepts).
For beginners who want to create Basics Commodity Systems , it's difficult for them to device their own commodities trading strategies since they do not have much knowledge about the commodities trading market. However, this site will explain how one-can create their own free commodities system in just seven easy steps. Best strategy is the one you come up with yourself and learn how to trade the commodity market with it.
The main advantage of creating your own free Basics Commodity Systems is that you will know how to make profits by yourself-and not rely on other peoples efforts.
In the next lesson located at the sidebar navigation learn courses menu below the key concepts will show you how to create a commodity system like the one above, write it's rules and how to back test it on a practice demo commodity account before using it on a live commodities trading account.
4 Examples of Free Basics Commodity Trading Systems
Examples 1: The Moving Average Crossover Method - Basics Commodity Trading Systems
The cross over method uses two moving averages to generate commodities trading signals. The first MA uses a shorter period and the second is a longer period.
Crossover Technique - Basics Commodity Trading Systems
This above technique is referred to as the moving average cross over method because trading signals are generated when 2 averages cross above or below each other.
Commodity Trading System Trading Example - Short and Long commodities trading signal Generated - Basics Commodity Trading Systems
A buy commodity signal or going long trade is generated when the shorter average crosses above the longer average (Both Moving Averages Going Up).
A sell commodity signal or a going short trade is generated when the shorter average crosses below the longer average (Both Moving Averages Going Down).
Example 2: Stochastics Commodity Trading System
Stochastic Oscillator can be combined with other indicators to form a system.
- RSI
- MACD
- Moving Averages Commodities Trading Technical Indicator
Trading Systems Commodity Trading Example - Basics Commodity Trading Systems
Short Signal or Sell Commodity Signal - Basics Commodity Trading Systems
How the short signal was generated
From our rules the short trading signal is generated when:
- Both Moving Averages are heading down
- RSI is below 50
- Stochastic moving downward
- MACD moving downward below centerline
Short signal was generated when all the written trading rules were met. Exit signal is generated when a signal in opposite direction is generated.
Good thing about using such a method is that we are using different types of indicators to confirm the signals and avoid as many whip saws as possible in the process.
- Stochastic - momentum oscillator
- RSI - momentum oscillator
- Moving Averages Commodity TradingTechnical Indicator - commodity trend following indicator
- MACD - commodity trend following oscillator
Based on the chart time frame used this strategy can be used as Commodity scalping system when the min trading charts are used or as a Commodity Trading day commodity system when hourly charts are used.
Example 3: Trading System Commodities Trading Example
This system is fully explained within the commodities trading plan on the commodities trading plan lesson on this site under the Commodity Trading key concepts section located on right navigation menu.
Chart Timeframe
1 hour chart
Trading Technical Indicators that spot a new trend
Moving Average Crossover
Indicators which confirm the market trend
RSI
STOCHASTIC OSCILLATOR
Long Entry - Buy Signal
1. Both MA(moving averages) pointing up
2. RSI above 50
3. Both stochastics going up
Short Entry - Sell Signal
1. Both MA pointing down
2. RSI below 50
3. Both stochastics going down
Exit Signal
1. MA gives opposite signal
2. RSI gives opposite signal
Risk Management in Commodity Trading
Stop loss- 35 pips
Take Profit Commodity Order - 70 pips
Reward to Risk 2:1
Example 4: New Gann Swing Commodities Trading Chartist Plan
The Gann Swing Oscillator is meant to be used in combination with the Gann HiLo Activator & Gann Trend to form a complete commodities trading strategy oftenly referred to as the - "New Gann Swing Chartist Plan". Within this methodology the Gann Swing Oscillator is used to help determine market swings for trading only within the current market commodity trend is illustrated by the Gann Trend.
Below is the examples of New Gann Swing Chartist Plan
Gann Chartist Plan - Basics Commodity Trading Systems
