Tuesday, November 30, 2010

Commodity Strategy Trading Is a Bad Idea

Commodity Strategy Trading Is a Bad Idea : Most commodity trading experts advise that it is not right to keep changing commodity trading strategies. This is one reason why most commodity traders loose. These traders invest a lot of their time trying to find out about a particular commodity trading strategy along with gathering enough evidence that it will work. However when they begin commodity trading with these strategies there could be a few loss trades. It is a common thing for strategies to fail, especially if you are testing it for the first time in a real time environment.

However this does not in any way imply that you switch over to a new strategy. If you want to be a successful commodity trader then it is essential that your strategies are consistent as well. In other words, if you want to see sizeable profits from commodity trading, it is advisable that you choose a commodity trading strategy and use it for a long time to see if it really works.

This is because the market is not always constant, moreover market condition differ often resulting in a different outcome. The general rule of a strategy is that it performs well for a few weeks when commodity trading is in a range however it then begins to fall when the market starts to trend.

This is one reason why most new traders abandon systems and strategies early itself if they do not see good returns. These kinds of traders are only looking for a get rich quick commodity trading strategy; however what they do not realize is that this could be fatal in the long run. Choosing to leave out a strategy just because it did not give any yields within the first few weeks of commodity trading is the worst decision that anyone can make.

When you adopt another new strategy you will learn that the new strategy takes time to adjust and this could again result in a down period. Getting new strategies and dumping it because you haven’t found any success will prove fateful.

Since any strategy takes time to start building up on profits, and as a trader looking to make the best of the commodity market you need to let a strategy give you its best. If you are therefore looking to make profits from the commodity market then its best that you don’t skip though strategies, since changing strategies could eventually lead to a huge loss.
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