Fundamental Outlook
The base metals complex will continue to take cues from the movement in the dollar, economic data and risk sentiment in the financial markets. Though Chinese data has come on the positive side concerns over lower lending in the world's biggest base metal consumer may lead to downside pressure. If the dollar continues to retain strength on the back of risk aversion then base metal prices could witness downside pressure. But sharp losses in the case of Nickel could be capped on the back of supply-related issues.
Copper managed to end in the green last week despite a rise in inventories
Base metal prices ended last week in the negative territory as concerns over the strength of the global economic recovery coupled with monetary policy tightening in China put pressure on prices. The only exception was Copper as the red metal reversed losses by the end of the week as fund buying came in as a support to prices. Base metal prices faced downside pressure in the last week as a stronger US Dollar also exerted pressure on prices. Though China released upbeat economic data financial markets witnessed risk aversion that reduced demand for higher-yielding and riskier investment assets. Economic data from China indicated that the country's GDP growth for the year 2009 was higher than expectations, reaching 8.7%. China's fourth-quarter GDP for 2009 increased 10.7% and the country's industrial output grew 11% for 2009. Though this data is positive, base metal prices may feel pressure on the downside as this sharp growth in GDP could demand further stringent monetary policy tightening by the Chinese government. This could be a bearish factor for base metals as China is the driver for base metals demand and curb in credit could affect demand for the commodities.
Stronger US Dollar puts pressure on prices
The dollar gained 1.4% in the last week and put pressure on dollar-denominated commodities. A stronger dollar makes base metals look unattractive for holders of other currencies. The dollar is gaining strength as risk aversion in the financial markets coupled with poor investor sentiment has led to higher demand for the low-yielding dollar. Overall commodity prices also declined on concern that China will raise interest rates and banking curbs proposed by US President Barack Obama may dent the US economic recovery. If worries over the global economic strength continue to linger then the dollar could strengthen further and add downside pressure on dollar-denominated commodities. Markets still remain concerned that the economic recovery may have been backed by the stimulus support measures by global policymakers and the impact may not be visible in the immediate future. These concerns in the financial markets may reduce risk appetite of investors and lead to selling pressure in higher-yielding and riskier investment assets.
If you want to buy shares then open demat account in india
Wednesday, January 27, 2010
Friday, November 6, 2009
Wednesday, September 2, 2009
TRADING TIPS IN COMMODITY FUTURES
Commodity markets are markets where raw or primary products are exchanged. Many new commodity investors will hire a commodity broker to help with their trading. Commodity futures’ trading is a price risk management tool and permits traders to enclose their profit and cover against unfavorable price movement in the future.
Brokers typically do a lot of research on the markets, so they are able to spot regular trading opportunities that new traders miss. A commodity broker’s job is to provide you with a trading plan and make certain you to stick with it. Online commodity trading investors are usually better off hiring a full service commodity broker. Take the time to evaluate a broker thoroughly before you open an account. And, if you are not satisfied with a broker you hire, do not be afraid to look elsewhere.
Compared to stocks, future trading is much cheaper, because margins are much lower than in stock futures.
Brokerage is low for commodity futures.
If you are a die-hard trader who trails the technical commodities charts and commodity news and does not really care what to trade, then commodity futures could be one more positive feature class that you would be fascinated by.
The benefits in Online commodity trading is that there are no balance sheets, no complex financial statements----all you have to do is follow the supply and demand spot of the commodities you trade in very strictly.
Move to the commodities exchange trading on NCDEX and MCX - to see which commodities are offered for trading, their contract size and other decisive factors. It would be clever to stay away from commodity trading if you are a recruit. A better move would be to originally trade in stock futures before opting for commodity futures.
The commodities spot price is the price, which is quoted for immediate settlement. Depending on the item being traded, spot prices can indicate market expectations of future price movements in different ways. Spot prices can therefore be quite volatile and move independently from forward prices. According to the unbiased forward hypothesis, the difference between these prices will equal the expected price change of the commodity over the period.
To make trading in commodities market simpler and hassle free, Angel Broking provides user-friendly online platforms for commodity trading in the leading commodity exchanges such as three different online products tailored for traders & investors, Single Screen customized market-watch for MCX / NCDEX with BSE / NSE, Streaming Quotes and real time Rates and Intra-day trading calls.
Also a collection of daily, weekly and special research reports is offered for further guidance and highly skilled analysts with professional industry experience guide the investors in their trade journey of Commodities trading.
Brokers typically do a lot of research on the markets, so they are able to spot regular trading opportunities that new traders miss. A commodity broker’s job is to provide you with a trading plan and make certain you to stick with it. Online commodity trading investors are usually better off hiring a full service commodity broker. Take the time to evaluate a broker thoroughly before you open an account. And, if you are not satisfied with a broker you hire, do not be afraid to look elsewhere.
Compared to stocks, future trading is much cheaper, because margins are much lower than in stock futures.
Brokerage is low for commodity futures.
If you are a die-hard trader who trails the technical commodities charts and commodity news and does not really care what to trade, then commodity futures could be one more positive feature class that you would be fascinated by.
The benefits in Online commodity trading is that there are no balance sheets, no complex financial statements----all you have to do is follow the supply and demand spot of the commodities you trade in very strictly.
Move to the commodities exchange trading on NCDEX and MCX - to see which commodities are offered for trading, their contract size and other decisive factors. It would be clever to stay away from commodity trading if you are a recruit. A better move would be to originally trade in stock futures before opting for commodity futures.
The commodities spot price is the price, which is quoted for immediate settlement. Depending on the item being traded, spot prices can indicate market expectations of future price movements in different ways. Spot prices can therefore be quite volatile and move independently from forward prices. According to the unbiased forward hypothesis, the difference between these prices will equal the expected price change of the commodity over the period.
To make trading in commodities market simpler and hassle free, Angel Broking provides user-friendly online platforms for commodity trading in the leading commodity exchanges such as three different online products tailored for traders & investors, Single Screen customized market-watch for MCX / NCDEX with BSE / NSE, Streaming Quotes and real time Rates and Intra-day trading calls.
Also a collection of daily, weekly and special research reports is offered for further guidance and highly skilled analysts with professional industry experience guide the investors in their trade journey of Commodities trading.
Monday, December 15, 2008
Online Commodity Trading: Hedge Your Future
Online Commodity trading: Hedge your future
After a long confinement of legal restrictions commodity market is now performing freely and is rapidly gaining popularity. Since 1987 it has caught the attention of traders. The market of commodity futures is explained as a constant auction market providing the latest information about supply and demand with respect to individual commodities.
The primary driving force behind the commodities futures market is its effective mechanism of managing the price risk. Traders can prevent themselves from adverse price shocks through buying and selling future contracts today, for the items to be delivered tomorrow.
The readers might feel that price risk management is the sole objective of the traders in a commodity market.
In fact, when classified broadly, the traders in the commodity futures market have two classes; hedger and speculator. Hedgers, through trading, protect themselves against unfavorable price changes which might occur in the meantime. The hedgers establish a known price for a specified period of time in advance for products they want to buy or sell in the cash market. The speculators, forming the other class, are investors with high speculative skills. They trade with the purpose of gaining from the change in the price of the commodities. They are not interested in taking the delivery of the underlying commodity in the futures contract.
Interaction between the hedgers and the speculators helps in providing liquidity and competitiveness of the commodity markets.
So far the article provides just an overview of the commodities futures market. Although the futures trading is performed with the hope of waiving off the risk yet it is a risky business. Here is where the role of advisors comes into the picture. Presently there are a plenty of advisory services offered by the broking houses. Choosing the broking house may seem a little tough in the beginning. It is always recommended to select the broking house that comes with an excellent advisory team; efficient advisory team is well ensured by the research work carried by the broking firm.
In this regard, Angel Broking holds the largest extensive research tem, producing weekly and monthly reports on the market, technical analysis reports to follow the indices perfectly and also forecasting reports for more in-depth knowledge.
For the convenience of the traders, Angel offers three different online platforms for online trading in the commodity market. Any client of Angel is well armed against the unprecedented shocks in the futures market since his trading is backed with expert advices. The online trading platforms offered are user-friendly and are coupled with a number of features to allow a trader utilize the entire trading hours. The greatest advantage of Angel is its back office support which is available 24 hours a day, 7 days a week.
With so many options of help available, it is less likely for risk to penetrate in futures trading.
After a long confinement of legal restrictions commodity market is now performing freely and is rapidly gaining popularity. Since 1987 it has caught the attention of traders. The market of commodity futures is explained as a constant auction market providing the latest information about supply and demand with respect to individual commodities.
The primary driving force behind the commodities futures market is its effective mechanism of managing the price risk. Traders can prevent themselves from adverse price shocks through buying and selling future contracts today, for the items to be delivered tomorrow.
The readers might feel that price risk management is the sole objective of the traders in a commodity market.
In fact, when classified broadly, the traders in the commodity futures market have two classes; hedger and speculator. Hedgers, through trading, protect themselves against unfavorable price changes which might occur in the meantime. The hedgers establish a known price for a specified period of time in advance for products they want to buy or sell in the cash market. The speculators, forming the other class, are investors with high speculative skills. They trade with the purpose of gaining from the change in the price of the commodities. They are not interested in taking the delivery of the underlying commodity in the futures contract.
Interaction between the hedgers and the speculators helps in providing liquidity and competitiveness of the commodity markets.
So far the article provides just an overview of the commodities futures market. Although the futures trading is performed with the hope of waiving off the risk yet it is a risky business. Here is where the role of advisors comes into the picture. Presently there are a plenty of advisory services offered by the broking houses. Choosing the broking house may seem a little tough in the beginning. It is always recommended to select the broking house that comes with an excellent advisory team; efficient advisory team is well ensured by the research work carried by the broking firm.
In this regard, Angel Broking holds the largest extensive research tem, producing weekly and monthly reports on the market, technical analysis reports to follow the indices perfectly and also forecasting reports for more in-depth knowledge.
For the convenience of the traders, Angel offers three different online platforms for online trading in the commodity market. Any client of Angel is well armed against the unprecedented shocks in the futures market since his trading is backed with expert advices. The online trading platforms offered are user-friendly and are coupled with a number of features to allow a trader utilize the entire trading hours. The greatest advantage of Angel is its back office support which is available 24 hours a day, 7 days a week.
With so many options of help available, it is less likely for risk to penetrate in futures trading.
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