Momentum Commodities Technical Analysis and Momentum Trading Signals

The Moving Average Envelopes indicator creates two lines around the commodities trading price forming a channel. The upper and lower channel lines are drawn at an equidistant level above and below the Moving Average. The distance to draw the envelopes is calculated using a percent or a number of pips.

Moving Average Envelope

Commodity Technical Analysis & Generating Trading Signals

MA Envelope can be traded using several different trading rules. The main technique of generating commodities trading signals is to use the commodities trading price penetrating the upper channel or lower channel.

Bullish Trading Signal

Commodities Price penetrating the upper channel is a long buy commodities trade signal.

Buy Trading Signal

Bearish Trading Signal

Commodities Price penetrating the lower channel is a short sell commodities trade signal.

Sell Trading Signal

In a trending market the MA points upwards in an up commodity trend market or downward in a down commodities trending market. It is good to use the envelopes together with other technical indicators such as commodity trendlines so as to confirm the trading signals generated.