Learn Commodities Trend Reversal Strategies

A trader must create a commodity strategy which they stick to when trading the online commodities market. A trader must have the discipline to follow the rules of their commodity strategy at all times. That is why it is better to come up with trading strategies that are profitable - profitable commodity systems will be a lot easier to follow & stick to. This is because a trader knows that by following the rules of their commodity system they will be successful.

A carefully designed trading strategy which has been back-tested and proven to produce profitable trading results is one of the keys to becoming successful when trading the commodities market. This type of strategy will make it easier for the trader to follow the rules of their commodity strategy because they already know that the trading strategy is profitable, therefore maintaining the discipline to continue following the commodity system will be much easier.

Successful commodity strategies will also include:

1. Commodities money management guidelines

2.Commodity Trading Psychology Mindset

These 2 will greatly improve the success of any commodities trading system.

However, Let us look at commodities trading price action strategy before explaining more about commodity money management & commodity psychology.

Counter Commodities Trend Strategies

Counter commodity trend strategies are best used to place trades on major resistance and support areas where commodities trading price is likely to reverse. These are the support and resistance levels where commodities trading price has not broken before.

However, this strategy isn't the most reliable commodity method because trying to catch the commodity market top or the commodity market bottom is not the best strategy as the commodity trend may continue to move in the original direction of the commodity trend for quite some time.

This strategy should therefore only be used to trade commodity trading that rarely commodities trend. Commodities traders can draw support and resistance levels of the commodities trading price range and they will then use these levels to open trades - traders will open buy commodities trades at the support level and traders will open sell commodities trades at the resistance level. For a range bound market the commodities trading prices will keep bouncing off these points and the traders will open trades and keep trading these commodities trading price bounces.

Commodity Trading Strategies Tips

Once a trader has come up with their commodity strategy, they should also include the following so as to make their commodity strategy more successful.

1.Commodities Trading Money Management Rules

2.Commodity Trading Psychology

Commodities Trading Money Management Rules

Commodity money management guidelines should be part of your commodity strategy - these rules will help you as a trader to manage risk. This means that you will use two rules of commodity money management - these are risk : reward ratio & drawdown reducing technique when placing your commodities trades to determine lot size that you will open in the commodities market. The most popular commodity money management rule use in commodity & the one that you should also add to your trading plan is the rule that says a trader should never risk more than 2% of their account balance on any one single commodities trade.

To learn more about these two commodity money management guidelines, traders should read the commodity money management guide that is on the learn commodity lessons section of this web site under the commodity key concepts lessons.

Commodity Trading Psychology Mindset

In order to become successful when trading the commodity market a trader has to learn about commodity psychology. The commodity psychology or mindset that is required to become successful in commodity is one that avoids the emotions of fear & greed while trading the commodity market & is a mindset of total discipline that a trader will follow all their rules & their commodity strategy & only trade with signals which are generated by their commodity strategy. With discipline a trader will not trade unless their commodity strategy gives a signal. A trader will have the mindset of only following their commodity system 100% all the time without second guessing the commodity system. A disciplined trader will also not place trades in commodity market just because the commodity market has started to move upwards or downward, instead a trader will wait for a signal to trade to be generated by their commodities trading strategy.

In order to study more about commodity psychology and how to manage emotions while trading the online commodity market a trader can read the commodity psychology tutorials from the learn commodity lessons section of this web site under the commodity key concepts tutorials.