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Chapter 28, Part I. Intermarket Analysis - Commodities. Page 6

Discussion in 'Complete Trading Education- Forex Military School' started by Sive Morten, Dec 26, 2013.

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  1. Sive Morten

    Sive Morten Special Consultant to the FPA

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    Pipruit: But Sir, it could change just for some millions of barrels? Why it is so important, if this is smaller than the daily consumption in US?​


    Commander in Pips: The reason in tendency. This data is very similar to weekly claims. Who cares that Initial claims rise just for 5,000 people – this is very few in the scale of the whole country. But this could be as 5K on current week, 7 K on next one and so on. Then, when you will compare two numbers, say in the beginning of the quarter and at the end of it – you’ll see the tendency. The same is with the weekly crude inventories. If week by week, reserves are falling – it means that consumption is growing.

    Currently many forex brokers allow you to day trade commodities and have the ability to look and analyze charts. But it they don’t, you may use the same Timing charts site. Commodity Futures & FOREX Charts | Commitments of Traders Database www.timingcharts.com


    And the last thing - just to finish with commodities… As with the forex market, an index exists on the commodities markets. This is the Commodities Research Bureau Index – this index includes the prices of all major commodities – energies, metals, food, industrials etc… In fact the CRB Index is a barometer of Commodities just as as the Dollar Index is a barometer of the forex market in general and Dollar value in particularly. On the following chart you may see that there is rather strong negative correspondence between these two indexes:


    Chart #5 | CRB and Dollar Indexes – weekly chart
    [​IMG]

    Correlation is also significant “-80.32%”. Both of these assets are basic for world economy, that’s why it’s better to keep an eye on them from time to time, especially if you trade long-term.



    P.S. This lesson was written by Sive Morten, who has been working for a large European Bank since April of 2000, and is currently a supervisor of the bank's risk assessment department. Sive's knowledge of forex market and banking industry is vast and quite complete. If you have any specific questions about forex, banking industry, or any other financial instruments, please post them on the next page and Sive should answer soon.



    Note: FPA ranks are earned in the battles against scam, not in the classroom.
     
    #1 Sive Morten, Dec 26, 2013
    Lasted edited by : Oct 8, 2016
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