Sunday, 31 July 2016

Commodity - Research


What are the various factors keep in mind before trading in commodity?
There are several factors that should be kept in mind while trading in commodities, which are shown below in terms of various segments in commodities:
Agri- Commodities : Carryover stocks, Crop acreage, Production, Imports and exports, Government policies, Procurement
Non-Agri commodities: 
Metals- Currency fluctuations, Global supply and demand factors, Inflation, Unexpected political, Social and Economic Mayhem.
Energy- Stocks of Crude Oil and Petroleum, OPEC production variance from quota, Demand factors, OPEC spare capacity, Refinery capacity variance, Interest rates, U S dollar
What are supports and resistances?
Support and Resistance is a concept in technical analysis that the movement of the price of a security will tend to stop and reverse at certain predetermined price levels.
Support: Is the price level where the price tends to find support when going down and from that level more buyer participation come into play inching prices higher.
Resistance: The level where the price find obstacle while trending up and a possible increase in sellers could be looming from that level pushing prices down.
What is the exact time for entering and exiting from market?
Preparation and better commitment to self research prior to entering the commodity market can help to decide upon entering and exiting the position from the market. Also, research assistance from the associated broker can also help in deciding when to enter and exit a market.
What is fundamental analysis?
Fundamental analysis is a means of analyzing commodities and trying to predict where the prices of commodities should be trading and what they will do in the future. The main basis for fundamental analysis is supply and demand.
What is technical analysis?
Technical Analysis is the forecasting of future financial price movements based on an examination of past price movements. Technical analysis can help investors anticipate what is "likely" to happen to prices over time. Technical analysis uses a wide variety of charts that show price over time.
How currency volatility affects the markets?
Currency volatility has a significant bearing on the commodity price moves. For example, commodity prices tend to rise on a rising Euro especially bullion (This should not be taken as a reference outcome). A rising dollar on the other hand tends to push prices of commodities in dollar terms like Crude Oil down. Therefore, a rising dollar results in fall in commodity prices or visa versa. Dollar and Euro currency tend to move in opposite direction on most of the cases but can differ as per market situations.
How dollar/Euro affects commodities?
Dollar and Euro has a significant bearing on the commodity price moves. Commodity prices tend to rise on a rising Euro especially bullion (This should not be taken as a reference outcome). A rising dollar on the other hand tends to push prices of commodities in dollar terms like Crude Oil down. Therefore, a rising dollar results in fall in commodity prices or visa versa. Dollar and Euro currency tend to move in opposite direction on most occasions but can differ as per market situations.
What are economic data/releases?
Economic data or economic statistics may refer to data (quantitative measures) describing an actual economy, past or present. Examples of economic data include, Gross Domestic Product (GDP), Industrial production, Manufacturing, retail sales and Unemployment figures etc.
To read more: http://geofin.co.in/ResearchRept/Importance_of_Economic_Indicators.pdf
Who are the players in commodity market?
Hedgers, speculators and arbitrageurs are the major participants in commodity market. Hedgers are main players in the market with an underlying risk in a commodity. Speculators are traders or investors who took benefit or profits based on price fluctuations. They essentially create more liquidity to the contracts. Arbitrageurs are other type of experienced group which make profits by exploiting the price discrepancies seen in different exchanges or the spot market by equally entering with the opposite positions of the same contract.

About

Parag Patil is a technical analyst and trading system designer with stock excel programmer. I hope the articles and live chart of nse future and mcx on this Website will be as helpful and profitable to you . I try to update and post new articles tips everyday. My motto is to encourage the traders, so that they should able to understand the technique views behind the moment of stocks. I have deeply analyzed with many technical indicator with parameter and added to my amibroker afl. And even taken backtest report which is never being implemented. Any of the analyst expect me. Seeing all this you may understand that my views is more technical than commercial. If you are profited by my views I fill happy.

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