If the trades turn & move in the opposite directions beyond entry levels, they might further move very fast in a volatile manner & the losses accrued, in the absence of a stop-loss, can be un-imaginable. There are several things happening across the globe constantly, which affect the price movement, direction & volumes in commodity trading, as basically they move in accordance with demand and supply situations & are also greatly affected by the Geo-political scenarios all over. It is not humanly possible to track each & every occurrence, watch out for economic data’s released all around the globe and understand the level of their impacts on the trade movement & direction of all commodities, though you may be constantly updated on most of the developments, most of the time. Many times the reaction or the impact of these developments is so quick & enormous, that large & rapid movements in rates are instantly triggered with high volatility, even before the news on these developments reach all over the https://www.calliber.io/ world. In such a scenario, you may never know as to what level these trades could go to & the losses (though sustainable by a few) may be very large. These losses are not the only losses that you incur if caught in such a situation – you also miss out on the opportunity, the same commodity is offering, in the opposite direction and also by other trades as most of your attention and funds will now be concentrated and caught up on this particular trade gone wrong. Remember – Growing wealth is important, but safe guarding seed capital is even more important. It’s easier to resist & also absorb losses at the beginning than later.
18] Averaging in loss making positions is a practice which is most commonly seen & generally leads to more dangerous losses. This is also recommended by a number of advisors, but I certainly do not recommend it. In fact I strongly oppose it. Remember – YOU are incurring the loss & not your advisor.
19] Putting all your eggs in one or a couple of baskets could prove to be more dangerous for the day trader. Having a wider investment or a trading spectrum would be more effective. All entered trades may never go wrong simultaneously but a stray one or two could and what, if you have traded in only those? It may also happen that the 1 or 2 trades that you have entered into, have moved in the right direction, but have not achieved the expected high results or gains in comparison to the ones you have left out. So it is only advised and not stressed upon – that the trader should take positions in a wider range of trading / investment opportunities to achieve better results.
20] Do not be biased to a particular commodity. Look at all commodities (having healthy trading volumes) only as profit generating opportunities & not at the English name or Social status of the commodity.
21] Always remember -“You cannot use yesterday’s ideas for today’s business and expect to be in business tomorrow”. Be ready to accept and implement change immediately and constantly as “Change” is the only factor that’s constant in the world – everything else keeps changing and its meaning is all the more true in these highly volatile and ever-changing market scenarios.
Adherence to the above is sincerely recommended to trade and achieve gains in these ever volatile Speculative Trade Markets.
Rajesh J. Shah’s is the Chairman of Moneyline Futures Consultants P. Ltd., which is an Investment & Trade Advisory Organization which offers trading ideas & tips for Trade in all Commodity & Equity Markets. We offer MCX Trading Tips, Gold & Silver Tips, Commodity Trading tips & Advisory Services for Indian, U.S. and other Global Commodity Markets. Get Latest news on commodities, Market data & Live Commodity Rates. Our Forecasts & News updates cover gold, silver, copper, crude oil, agro commodities, Commodity Trading & a plethora of other factors affecting the price, movements & direction trend of precious metals & other commodities in the commodity trading markets. Moneyline offers valuable insights to both investors and traders globally, in Gold, Silver, Copper, Crude Oil & other Commodities traded on the exchanges, with early info as to where they are headed directionally.
The highlight about Moneyline Advisory Services, is the infallible ability to generate the most Accurate Forecasts, leading to highly profitable Investment & Trading Tips with a solid Time Frame well in advance. We have always given a time frame of major Socio – Economic occurrences & developments, months & years in advance. Most advisories would recommend to avoid timing the markets due to the same being The Most Difficult feat or objective to achieve. Our Short term to medium term forecasts have also proven to be highly effective for Wealth Building, but our longer term forecasts have always been our forte & also the largest & secure Wealth Builders. This particularly rare ability provides very effective methods to generate gain yielding trading strategies in all our advisory service areas – be it Commodity, Currency or Equity Market Tips. Guidance at each step to earn phenomenal gains in both the directions – in a price Rally or a price Correction.
Your decision to start learning to trade commodities will give you a completely new insight into the whole world of commodity futures trading. This could be within a specific sector such as grains or precious metals or perhaps across the whole spectrum of global commodity markets. Now doubt you have heard concerns about energy security and the crude oil trade on the New York Mercantile Exchange, and of how the price fluctuations can be caused by a whole range of factors. And what causes price movements in gold, silver and other precious metals and why should cocoa or coffee futures prices suddenly surge?