Monday, November 25, 2013

How to trade commodities markets

One way to climb above the chaos is through abstraction, and in a good way technical analysis is a methodology that abstracts, for it identifies varying price levels deemed important. Most technical analysis was initially with  patterns like heads and shoulders, cups and handles, candle sticks. Eventually, with the advent of computers and number crunching, classical technical analysis turned into data analysis with relative strength indicators, Bollinger bands, and varying types of oscillators. Measuring price and volume action at critical price zones is what trending technical analysis is all about.  It's a way to measure supply and demand.  One form of  a mistake would be having too many indicators  or oscillators on your chart  this topic has been covered in several articles from the trading type sites.  Another form of mistake is looking at every turn or support resistance level that has been formed in the past and still consider it as a valid level for our future trades.
Commodities Markets