Wednesday, January 30, 2008

Metal and oil hold promise in 2008 - 2

Edible oil

According to data released by the Government, there is a possibility of a lower Rabi oilseed crop for 2008 in India. That would mean bullish sentiments for edible oil and related commodities.

Metals (aluminum and steel)

The consumption of metals will continue to be high due to heavy infrastructure development activities in India and China. Therefore, the rates in metals are expected to trade firm in the medium term.

Here are some key points traders should keep in mind while trading in commodities futures:

Discipline: Traders should maintain proper discipline while trading in commodities.

Due to lower margin deposit in the carrying positions in commodities futures, the leverage becomes higher and as a result the potential of profit and loss goes up. Traders are recommended to maintain strict stop-loss and profit targets on their trading positions.

Track market movements: Commodities market is much wider and requires a wide variety of information.

Commodities trading is open for more than 12 hours per day. These factors pose a huge challenge for the traders in the commodities futures market.




No comments: