Trading
commodities is a tricky business. It is a well known fact that
the majority of trades in the commodities market lose money...
95% to be exact. There are a lot of promoters that are trying
to sell you their program which is almost guaranteed to make
it a 'piece of cake' and 'easy as pie'. Yeah, ask Hillary, who
after she made the $100,000 in commodities with the support of
Tyson Foods somehow dropped out of making that all that easy
money. If it were so easy why would she be trying for a senate
seat in New York. Prestige ? OK, maybe... Yeah, it's harder than
you think, Hillary ! ...
However,
trading commodities as well as stocks
has
always held a fascination for the American public. Stock Market
systems sell like hotcakes. Wade Cook's company made millions...
it's a public company... by selling stock market tips.
Wade's
so-called 'secret' is to buy both a 'put' and a 'call' (both
options) since that way you are covered whether the market goes
up or down. You not covered if the market goes sideways... What
is overlooked is the cost of options. Options cost a lot money.
There are always cheap options, but heck... you have to look
hard for those...
Cook's
other big revelation is that if you own stock, you can ' write'
or sell options for income. That's his big pitch on the radio
commercials. But, that is no secret... nor is it anything new
!
There
are two ways to forecast the commodities market. 1) Fundamental
and 2) Technical.
1)
Fundamentals have to with the weather, shortages , supply and
demand. Fundamentals give you good reasons for a change... but
the timing is not generally very good, and timing is everything.
2) Technical has to do with following the patterns of the plotted
history of the market for the individual
commodity
and the timing is much better if you keep your eye peeled for
the fundamentals... If there is a freeze in Florida Orange Juice
goes up!
There
are natural points of ' resistance' (stopping the upward movement)
and 'support' (stopping the downward movement). Anything in between
is a trend, and there bumps in the road. Remember, "the
trend is your friend"... If there is no upward or downward
movement, you are in a channel and it will eventually 'break
out' either upward or downward. The 'trick is to place your 'buys'
or 'sells' at a point where you are sure of the 'breakout'.
The
foregoing paragraphs give you about as much information as most
of the promotional guys that are selling packages for $100 to
$200 about 'secrets' of the commodities trading market. But you'd
be irate if I had charged you over a hundred bucks for this info
without the fancy cover, tapes, and the album to put them in.
What you didn't get here is the 'you can do it' hype. Well, you
*can* do it... all you have to do is to 'paper trade' for a while
and when you start getting the feel for it, you can switch to
real money... or you can take the Dale Carnegie course for self
assurance.
A
free tip for you you won't find in these expensive manuals ...
a friend of mine does very well by trading the 18 day adjusted
average. When the market crosses the line he either buys or sells.
This crossover indicates a change. Try it... and let me know
if you like it.
One
of my projects is to write a manual on commodities and sell it
for half the price of the info gurus with twice the information.
The people who want to know about trading should not be required
to pay a $175 initiation fee even though they get a lot of tapes
to go along with the fancy book.
The
good news is that this project is now complete and you can buy
the manual and a one month's subscription right here...in the
column on the right where it says "Order Now ! "