What is a Retracement?

What is Retracement in Commodities?

The commodities trading price of a commodity instrument doesn't move up or down in a straight line. Instead the commodities trading price moves up or down in a zigzag pattern called a commodity trend - in this pattern the commodities price moves upwards in a commodity trend then it retraces before resuming the commodity trend direction - in a downward commodity trend the commodities trading price moves downward in the commodity trend direction and then retraces before resuming the commodity trend direction.

What is retracement? A commodities trading price retracement is a pullback of the commodities trading price before the commodity market resumes the original commodity trend movement.

Example of Zigzag Commodities Price Movement: The example illustrated and explained below shows commodities trading price moving up in a zigzag pattern showing commodities trading price commodity trend and commodities trading price retracement.

The example illustrated and explained below shows movement in an upward market and commodities trading price retracement.

What is Retracement? - What is a Commodity Retracement? - Commodities Price Retracement Explained With Example

What's Retracement Trading in Commodity?

1-2: Commodities Price Moves Up - Commodities Trend Direction

2-3: Commodities Price Retracement

3-4: Commodities Price Moves Up - Commodities Trend Direction

4-5: Commodities Price Retracement

5-6: Commodities Price Moves Up - Commodities Trend Direction

The retracement of commodities price is described on the above examples - this represents a commodity retracement in an upward commodities trend.