TIPS: MAXIMIZING PROFITS OF Commodity Trading SYSTEMS
1. Define Simple Trading Rules & Follow the Trend
The simpler the commodity system is the better. If the commodity system is too complicated, it will be very difficult to stick to the commodity rules. Complicated commodity systems are also very confusing. A simple commodity system makes it easy to follow the trading rules.
2. Eliminate Risk Quickly and Let Profits Run
Minimizing risk is far more important than making money. Our first main aim in commodity is to make the trade less risky. We do this by entering only trade setups, setting stop losses, cutting losses quick and never average down, and letting the profitable trades run for a while, just long enough but not too long so as increase the profits. Profitable trades are only kept open as long as the commodity system shows the trend is in place, these transactions should be closed immediately once your exit signal criteria is generated by the commodities trading system.
3. Choose the Right Commodity Trading instruments
Once you have your commodity system, you will want to start testing it on a demo commodity account. A commodity system will give different results for each commodity.
To maximize the profitability of your commodity system find the most active market hours for a chosen commodities and trade during that market session only.
4. Use Commodities Trading Money Management Rules
Always risk less than 2% per commodity trade transaction. With compounding, you'll be surprised to see how quickly your commodities account grows once you start to trade with a profitable commodity system.
5. Keep a Commodities Journal
Keeping a log of all your commodities trades will help you to become a better and better and will help you follow the trading rules of your commodity system. A commodity journal will also keep track of your profitable trades & losses and you can analyze why a trade setup was profitable & why it was not.
6. Set take Profit Targets
Establish a daily, weekly or monthly profit targets when trading the commodities market. Once you hit this target. This will stop you from over-trading and will also stop you giving back your profits the commodities market. Keep your reward to risk ratio high, a 3:1 reward to risk ratio is best. This means opening commodity trade transactions only when you have the probability of making 3 times what you are risking.
Example of signals generated by our commodities trading system
Example 1: Buy Commodity Trading Signal and Sell Commodity Trading Signal Generated By Commodity Trading System
Buy signal is generated by the indicator based commodity system, then an exit signal is generated before another reverse sell commodity signal is generated on this commodities chart
Example 2: Two buy commodity signals generated by Trading System
Two buy commodity signals are generated during the upward commodity trending market
Example 3: Exit Signal Generated by Trading System
Examples of Signals Generated by a Commodity Trading System
Other Tips
Learn Commodity Trading Education
The first tip is to learn about the Commodities Trading Market (Learn Commodity Trading Lessons), those who don't learn the required commodity knowledge from the various commodity tutorials online will not improve their commodity results no matter how many tips they have read. By not learning commodity, these traders will keep making the obvious mistakes made by beginners without even realizing what they are doing, Commodity Trading is a wide topic and in order to make profits a trader will have to learn commodity first.
Get a Commodity Trading System
A commodities trading system is a must for every trader, a commodity system is used to determine what commodity decision to take. A commodity system gives a trader an edge over others who don't have a commodity plan. A good commodity plan is one that is back-tested and proven to produce profitable commodities trades. After coming up with your commodity system you should back-test it on a Demo Commodity Trading Account.
Learn Commodity Trading Money Management
Learn about The Various Commodities Trading Money Management Lessons, don't attempt to trade the online commodity market if you do not have commodity money management guidelines. The 2 commodity management lesson that you must learn are:
What is Commodity Trading Money Management
Commodities Trading Money Management Methods
Learn about Commodities Leverage & Margin
If you don't know what is commodity leverage and how it works and how it can affect your commodity margin, then you will not make any money in the commodity market and you will lose your money in the commodities market.
Have a Written Commodity Trading Plan
A commodity plan will take into account all the above commodity tips and summarize them within one document that you can use to trade the online commodities market.
In General
The first goal should be taking your time to really determine what your commodity goals are and how much money you wish to make. Once this is determined then the following three suggestions will help you on your way to start Commodities. It is essential to keep all the three goals in mind when executing all of your commodity trade transactions but at the same time this is not a black & white guide to commodity success.
The first thing is to remember that you really need to work with short term commodities trades until you become profitable and know how to properly monitor these trade transactions. You should trade commodity short term because this way you can monitor your commodity positions and quickly close any commodity position whose trading signal setup reverses. In order to truly benefit from the commodity system you have to be willing to take up the effort to watch the commodity market to see exactly how long you can keep your money invested in the online commodities market. Making short-term commodity investments will help you to monitor your commodities trades and control all the risks, do not leave commodity orders open when you are away from your computer or when you are going to sleep, close all commodity trade transactions & only open commodity orders when you can monitor them.
Although it is very important to increase the amount of commodities trades that you are investing each time that you trade - some commodity guidelines should to be followed. The general rule of commodity tends to be never to trade more than two percent of your total commodity account equity. This of course makes sense when you have a lot of money in your commodity account but what if you only have a couple of hundreds. Two percent of $10,000 equals out to be $200. Even though it is safer to follow this rule it really does not make a lot of economic sense with smaller commodity accounts. If you are investing on Commodity Trading this is when commodity leverage kicks in to effect and makes all of the difference. In General the more commodity capital you have to invest the better in terms of commodity money management.
Final suggestion is taking a bit of time to make sure that you get all of your commodity details correct before opening any one trade transaction, this will be the best method. Keep it simple makes just as much sense in commodities trading market than anywhere else. Although this might require more time and effort to build up your commodity profits it will save you money in the long term.
Trying to keep your thinking as clear as possible will make your commodity journey easier but knowing when to break from the norm is also important. Moving towards the right path will make success that much more easier to obtain and by learning all of the steps and logic you will be able to continue making profits. Commodity Trading isn't hard to learn but a lot of traders lose money quickly because of not taking the proper steps in preparation and learning.
