Commodity Trading Moving Average System Explained
Commodities Trading 20 Pips Moving Average Commodity Trading Systems
The 20 pips commodity price range moving average commodity trading strategy is used with the 1 Hour commodity chart and 15 minute chart. On this commodities trading chart time frames we use the 100 and 200 simple moving average commodities trading technical indicator.
Both the 1 Hour and 15 minute chart time frames will use the 100 and 200 Simple Moving Average (SMA Indicator) to determine the direction of the Commodity Trading trend.
The 1 Hour commodities trading chart time-frame checks the long term direction of the Commodity Trading trend, upward or downward trend, depending on the direction of the moving averages. All commodities trades taken should be in this commodity trend direction.
We then use the 15 min chart to find the optimal point to enter commodities trades. Commodity trades are opened only when the price is within 20 pips range of the 200 simple MA, if commodity price is not within this pip range commodities trades are not opened.
Commodity Trading Uptrend/Bullish Market
To generate buy (bullish commodity trading signals) using the 20 pips moving average Commodity Trading strategy, we shall use the 1hour and 15 minute chart time frame.
On the 1 hour commodities trading chart time frame the commodity price of the commodity chart should be above both the 100 and 200 simple moving average. We then move to a lower commodities trading chart time frame, the 15 min chart time frame to generate a commodity trade signal.
On 15 minute chart time frame, when price reaches the 20 pips range above the 200 Simple Moving Average, we open a buy commodity trade and place a stop loss 30 pips below the 200 Simple Moving Average. Stop loss can be adjusted to the amount of Pips that are suitable for your risk but to avoid being stopped out by normal Commodity Trading volatility its best to use 30 pips stop loss.
A buy commodity trade can also be opened when the price touches the 100 Simple moving average, provided it’s not very far from the 200 Simple Moving Average. Normally the 100 Simple Moving Average will be within the 20 pips range of the 200 SMA.
100 and 200 Simple Moving Average Buy Trading Signal - Moving Average Strategy
Commodity Trading Downtrend/Bearish Market
To generate sell (short commodity trading signals) using the 20 pips moving average Commodity Trading strategy, we shall also use the 1 hour commodities trading chart time frame and 15 minute chart time frame.
On the 1 hour commodities trading chart time frame, the commodity price should be below both the 100 and 200 Simple Moving Average. We then move to the 15 minute chart time frame to generate a commodity trading Signal.
On 15 minute chart, when price reaches the 20 pips range below the 200 Simple Moving Average, we open a sell commodity trade and place a stop loss 30 pips above the 200 simple moving average.
100 and 200 Simple Moving Average Sell Commodity Trading Signal - Moving Average Strategy
With this commodity trading strategy method commodity price will generally bounce of these support and resistance levels because many traders watch these levels, and open similar commodities trades at around the same point.
These support and resistance levels act as short term resistance or support levels within the commodity price charts.
Profit Taking level For This Strategy
With this commodity trading strategy the commodity price will bounce & make a move in direction of the original Commodity Trading trend. This move will range from 60 - 70 pips.
The best commodity trading profit taking level would therefore be considered to be 60 to 70 pips from the 200 SMA.
