Commodity market seems to be a lucrative avenue to a lot of traders and Investors. In the Commodity market various commodities are traded and one can take benefit of the price fluctuations to trade effectively in the commodity market. Various commodities are listed on the Commodity exchange and the relative prices of various commodities are traded on the exchange. There are various benefits of the Commodity trading like a trader can make huge profits by trying to forecast the Commodity signals. The most important part of the Commodity trading is to anticipate the Commodity trading signals.
Scalping: Intraday Trading Strategy For Commodity Market
One of the important benefits of the Commodity market is that the trader can form a strategy and trade on the basis of it. The Intraday strategies like First hour strategy or scalping techniques can be followed to earn good profits from the trades. Scalping is a technique to look at the price range during the first hour of trade and then look for a breakout from this range. Thus, if the prices break from the high it’s a buy call and a rise in the prices is anticipated. On the other hand, if a breakout from the lower limit of range is observed a down trend is anticipated. Thus, scalping is an important strategy in achieving good profits from the Commodity markets.
Also, there are other strategies available like trading for small profits. In this case small changes in the Commodity signals are generally traded for the profits. Also, a large number of trades are executed to add up to large profits, this will be applicable in Stock cash tips as well. The Commodity trading signals are unassuming but still with a proper plan and a proper strategy good profits can be made through Commodity markets. The trader can also base their trade based on the advice from the advisory firms who provide free Commodity signals initially and then charge a nominal amount for their services. Thus, the Commodity trading is beneficial if done with proper planning and strategy.
Trading based on the Charts
Trading in the stock or commodity market is an art difficult to master. People use various methods and strategies to trade in the stock markets. Trading based on the charts is one of the ways out of them. Various types of charts exist like Candle Stick charts and line charts. These charts can be plotted with varying time scale. The price movement depicted by chart can be an important way of forecasting future prices.
Thus, one can trade on the basis of charts and by applying suitable indicators of the technical analysis, one can anticipate the price movement. Trading on the basis of intraday Stock Cash Tips is the other way of trading.
Stock Market is a Place from where huge wealth can be amassed, if a proper strategy is followed. The support from Technical advisory companies can be taken to trade effectively in the Stock Market. These advisory firms provide tips in form of Stock Cash Tips and Stock Futures Tips.
The advisory companies have a team of Expert Technical advisors, who on the basis of their in-depth technical and fundamental analysis provide advice to trade. Advice in all the segments like Futures segment, Options segment and Cash segment can be taken from them.
In case of technical analysis the graphs of the price movement V/S time are generally drawn. The price unit is in INR and time frame can be chosen according to convenience. The Time Period of 1 min, 5 Min, 15 Min, 1 Hr etc any-thing can be chosen based on the analysis requirements. Along with the price charts, various indicators like RSI, Moving Averages, MACD etc can also be used. The technical indicators are based on various studies and various mathematical formulations.
Moving Average: Technical Analyst’s Trend Indicator
Moving average is an indicator which is used by many analysts. The moving average is a trend indicator and identifies the current trend. The trend can be up trend, down trend or flat trend. The market thus can be bullish, bearish or range bound.
The moving averages are also of different types. The common are simple moving average (SMA) and Exponential Moving Average. In SMA or Simple Moving Average the average of n periods is calculated and displayed on the graph. In case of an EMA or Exponential Moving Average, an exponentially increasing factor is also multiplied to the moving average. The EMA has a faster response, as compared to an SMA. For intraday trading, the SMA and EMA of period 5, 10, 20 etc are used depending on the time frame chosen.
The moving average cross over strategy is an important strategy used by many analysts. It is a kind of trend following strategy. Two moving averages of different periods are drawn and their movement along with the price movement is watched. One of the moving averages is slow one and one is the fast one. The cross-over of the two moving averages is seen as the signal of trend change and thus appropriate trades can be executed. If the trend is changing from a down trend to an up-trend the buy trade can be executed. Similarly if the trend has changed from an up-trend to a down trend, the sell trade can be executed.
Thus, one can easily execute the trend following strategies by utilizing moving averages. Both the SMA (Simple Moving Average) and EMA (Exponential Moving Average) can be used for this purpose. The results with EMA are better than results with SMA.
Cash and Cash Equivalents Asset classes for first time investors
It is the most liquid form of asset class that you can invest in. It includes physical cash, money in your saving accounts, short term T-Bills etc. You can easily convert these instruments for your needs but these instruments give a minimum or no possible ROI.
Fixed Income As the name suggests these asset classes gives a fixed income after a certain interval of cibil scoretime. These asset classes usually offer a rate of investment that will not be able to beat inflation in short to longer term. Fixed income instruments would include Bank fixed deposits, Recurring deposits, PPF, Post office saving schemes, Endowment plans etc. If you wants to earn a moderate ROI but at the same time don’t want to risk your money, then you must invest your money in these instruments.
Equity Equity is one asset class that is having highest risk with possibility of highest ROI. Equity refers to stocks and shares that you buy as a part of ownership in a company. This instrument is best suited for an individual with credit score rangehigh risk taking ability. Equities would include investment options like direct equities/stocks, Equity mutual funds, equity linked saving scheme, Exchange traded fund etc.
Real Estate Real estate investment is one of the most illiquid investments present in Indian market. You need to invest a large amount of money at the beginning to purchase a property. This form of investment is quit cyclical in nature and the rate of investment cannot be predicted with certainty. All major Indian cities are facing a slump in real estate market and ROI has been in single digits in all major cities in past few years.
Commodities � Commodities refer to the physical goods that can be bought and sold in the market. Gold and silver commodities are one of the most popular commodities in India. Indians have been investing in gold and silver since ages.ROI
Peer to peer lending � It is one of the most recent addition to investment asset classes available to investors. It is bases on social lending concept in which a group of lenders crowd fund a borrower. An investor in peer to peer lending can earn a ROI between pretax returns of 18% to 25% per year, which translates to 12% to 17% post tax returns per year.
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Start early � You should start investing in as early as you can. By staring early, you are giving yourself additional time for failure and success in investing journey. By cibil scorestarting early you are also giving yourself benefit of �power of compounding�. Power of compounding works as magic if you start early. For example if you invest Rs 1 lakh at the age of 25 then you will get close to 1 Crore Rs by the time you turn 50.
Invest in SIPs � SIP stands for �Systematic investment Plan� and is one of the best options to invest in market. You can invest through SIP in mutual funds. Mutual funds are the best option for first time investors. These mutual funds are professionally managed by fund houses invest in large number of companies. Before investing in any mutual fund, you should look for past average performance of the fund house, total experience, sectors and companies investment optionsmanaged etc. There are different types of funds available in market like large cap fund, mid cap fund, small cap fund, balanced fund, debt fund etc. Initially, investors should look to invest in balanced fund through SIP. By taking SIP route to invest in stock market you are reducing the burden from your side and also reducing the cost of funds over a longer period of time.
Say �no� to day trading � Day trading is an investment strategy adopted by some investors to invest or exit daily from the market. You should avoid this strategy and remain invested for longer period of time.
Dollar cost averaging � It is advisable for first time investors to not to invest loan against GPA propertytheir entire money at one lump sum payment in investment. For Ex � if they have 50 thousand to invest in stocks then they should break down this into 10 investments of 5000 each for 10 consecutive months. This will reduce their average cost of acquisition and even if market takes a down turn then their loss would be minimize due to �Dollar cost Averaging�.
There are plenty of new options available to first time investors to invest their money intelligently. It is advisable to invest in through SIP mode in balanced funds and tax saving funds. First time investors should avoid the trap of day trading and advice of relatives. Investment for a longer tenure is advisable for first time investors to take advantage of �magic of compounding� rule. The article on Loankuber made me inform about investment strategies for first time investors. This article on investment options proved to be very informative and beneficial to me and if you are a fellow borrower you should definitely give this article a read.