Commodity Indicators For Setting Stop losses In Commodities

Some commodities indicators are used for setting stop losses taking away the need for commodities traders to perform complex calculations on where to place these stop loss commodities trade orders.

A commodities trading systems trader can also place a stop loss commodity order according to these indicators. Some commodity technical indicators use mathematical equations to calculate where the order stop loss commodity order should be set so as to provide an optimal exit. These commodity indicators can be used as the basis for setting stop loss commodity orders. These commodity indicators follow commodities price action of a commodity instrument closely and define the boundaries which the commodities prices should move along in. When the commodities price moves outside these boundaries it is therefore best to close the open commodities trades because commodities price stops moving in that particular direction.

Some of the Technical commodity indicators that can be used to set stop loss commodity orders are:

Parabolic SAR Indicator

Parabolic SAR is like an Automatic Stop Loss Commodity Trading Order and Take Profit Commodity Trading Order Indicator used to set a trailing commodities price stop loss

Parabolic SAR provides excellent exit points.

In an upward commodity trend, you should close long trade positions when the commodities price falls below the Parabolic SAR technical indicator

In a downwards commodity trend, you should close short trade positions when the commodities price rises above the Parabolic SAR.

If you are long then the commodities price is above the parabolic SAR, the SAR will move upward every day, regardless of the direction in which the commodities price is moving. The amount the Parabolic SAR indicator moves up depends on amount that commodities prices moves.

Parabolic SAR - Commodity Indicator - Automatic Stop Loss Commodity Trading Order and Take Profit Commodity Trading Order Technical Indicator

Picture of parabolic SAR and how it is used

Bollinger Bands Indicator

Bollinger bands indicator use standard deviation as a measure of volatility. Since standard deviation trading indicator is a measure of volatility, the Bollinger bands are self-adjusting meaning they widen during periods of higher volatility and contract during periods of lower volatility.

Bollinger Bands indicator consist of 3 bands designed to encompass the majority of a commodity instruments commodities price action. The middle band is a basis for the intermediate term commodity trend, typically it is a 20 period simple moving average, which also serves as a base for the upper band as well as the lower band. Upper band's distance and lower band's distance from the middle band is usually determined by volatility.

Since these Bollinger bands are used to encompass the commodities price action, the bollinger bands can be used by traders to set stop loss orders just outside the areas of the bands.

Bollinger Band Setting Stop Loss Commodity Trading Order Level - Bollinger Bands Commodities Technical indicator

Commodities Fibo Retracement Levels Indicator

Fib retracement levels provide areas of support and resistance, these areas can then be used to set stop loss levels.

Commodities Trading Fibonacci Retracement level 61.8 % is the most commonly used level for setting stop losses. A stop loss commodity order should be set just below 61.8% Fibo retracement level

The 61.8 % Fibo retracement level technical indicator is used to set these orders since its rarely hit.

Fibo Indicator StopLoss Commodity Order Setting at 61.80% Retracement Level

Fibonacci retracement level 61.8% - Fibonacci Indicator

Support & Resistance Levels Lines

Support and resistance levels can be used to set stop loss levels where the stop loss commodity orders are set just above or below the support or resistance.

• Buy Commodities Trade - Stop Loss Commodity Trading Order set few pips below the support

Buy Commodity Trade - Stop Loss Commodity Trading Order set few pips below the support

• Sell Commodities Trade - Stop Loss Commodity Trading Order set few pips above the resistance

Sell Commodity Trade - Stop Loss Commodity Trading Order set a few pips above the resistance