What to trade

[JonnyT]

Hi folks,

I've dipped my toe into the commodities market with a long on Corn. This was based on a simple higher high, higher low.

Howwver I would like to trade a diverse spread of commodities and wandered if anyone had any thoughts on what tends to trend. I have absolutely no knowledge or experience of commodoties.

For example. Which Grain should I concentrate on? Corn, Wheat, Soya?

Any ideas welcomed.

Thanks

JonnyT

 

[oatman]

Jonny, they're all seasonal, it's worth digging out some history. Have a look at the volumes. I'm not up to date at the mo but soybeans was always a big one. You also get the spreads v soymeal and oil. Cotton used to have a good spec following. If you want to trade softs(cocoa,coffee,sugar) then NY is more liquid than London.

cheers

 

[ianshep]

Paul,

I'm assuming from your comments that you're looking at daily charts.

Gold has been showing nice, clean swings for some time and crude oil hasn't been too bad since the 'random' war volatility has been left behind.

Away from physicals, T-bonds trend nicely and so do a number of forex relationships. My favourites are ASD/JY USD/CAD and EU/GBP, because they all seem to exhibit nice, orderly moves and they are not muchly correlated with each other. For me, the worst forex cross is USD/JY which always seems strikingly 'dirty', with the daily range normally being pretty large compared with the interday movements and lots of long tails on the daily candles.

 

[darrenf]

Would agree on T bonds and forex generally. However, I think with forex you need to choose a number of instruments to follow and trade the ones that seem to be trending best at the moment.
To me, these are similar. EUR/USD, EUR/YEN, EUR/GBP, USD/CAD.
USD/JPY is messy and has been for some time but have a look at the period Oct 01 to August 02 for some very nice trends in USD/JPY.

One of the reasons I like forex is that you have a good choice of instruments, some of which will usually be displaying trending behaviour. I track nine pairs on a daily basis.

 

[TBS]

JT - go and have a play with www.traderscommunity.com

 

[JonnyT]

Sandy,

I've been exploring it and associated links for most of the day!!!

Many more days to go.

Thanks for the link.

JonnyT

 

[Andreas]

If you are starting in commodities I would look at markets with sufficient volume and OI, and which tend to trend nicely.

The grains are good, apart from oats which is very thin. Soybeans can be very volatile.

Livestocks trend nicely and have enough volume. Be careful with lean hogs, and stay away from pork bellies (too thin and volatile).

The currencies are good, so are the T-bond and Eurodollar.

The energies are volatile and require deep pockets (margin), except when you trade spreads. Be careful in general with the NY markets, they are not known for good and fast fills.

Just my 2 cents, have a good week !

Andreas

 

[-oo0(GoldTrader)]

Seasonal calendar spreads

If you are starting out, Seasonal calendar spreads.

Howwver I would like to trade a diverse spread of commodities and wandered if anyone had any thoughts on what tends to trend. I have absolutely no knowledge or experience of commodoties.