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How To Trade Commodities within Forex
Tue, May 6 2008, 07:19 GMT
by Forex Journal's Collaborators
This article is taken from the Forex Journal (March 2008 issue).
The author is Wayne McDonell, the Chief Currency Coach of FX Bootcamp, a live forex training organization that teaches people how to trade Forex while the market is moving for more than 12 hours per day. He is a member of the National Futures Association and registered as a Commodities Trading Advisor.
- Wayne McDonell discusses how a weather event in China could impact commodities and currency markets worldwide. He shares correlation numbers and lists markets that could benefit from the Chinese having to come to the market to make commodities purchases.
Successfully trading Forex comes down to pitting a strong currency against a weak currency. The process is simple. Locate a currency that is appreciating in value and trade it against a currency that is depreciating in value. The focus of this article will be to help you understand global money flow so you can anticipate changes in currency valuation based on intermarket analysis of commodity prices for gold, oil and stock indexes.
As a Forex trader and Commodities Trading Advisor, I can tell you that commodities and currencies are affected by supply and demand. However, supply and demand for an economy’s currency is often a direct response to the commodities that it sells to the rest of the world. Let’s examine what created the bull market of 2007 and what may make 2008 even better.
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Related article:
Intermarket Analysis of Forex Markets by Louis B. Mendelsohn
Published on Tue, May 6 2008, 09:20 GMT
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This publication is designed to provide accurate and authoritative information in regard to the subject matter covered. It is sold with the understanding that the authors and the publisher are not engaged in rendering legal, accounting, or other professional service. If legal advice or other expert assistance is required, the services of a competent professional person should be sought. In commodity trading, as in stock, and mutual fund trading, there can be no assurance of profit. Losses can and do occur. As with any investment, you should carefully consider your suitability to trade and your ability to bear the financial risk of losing your entire investment. It should not be assured that the methods, techniques, or indicators presented in this magazine will be profitable or that they will not result in losses. Past results are not necessarily indicative of future results. Examples in this magazine are for educational purposes only. This is not a solicitation for any order to buy and sell. The information contained herein has been obtained from sources believed to be reliable, but cannot be guaranteed as to accuracy of completeness, and is subject to change without notice. The risk of using any trading method rests with the user.Interested in forex trading? forex brokerage firms!
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