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5 Best Commodity Market Ideas

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Commodity markets are a little different in terms of trading from traditional equity markets and thus, here are 5 best commodity market ideas that can work in India. – PowerPoint PPT presentation

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Title: 5 Best Commodity Market Ideas


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5 Best Commodity Market ideas
  • Investmentz.com

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(No Transcript)
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What are commodity markets?
  • Commodity markets are a little different in terms
    of trading from traditional equity markets.
  • A commodity market is a market that trades in
    primary economic sector rather than manufactured
    products.
  • Soft commodities are agricultural products such
    as wheat, coffee, cocoa, fruit and sugar.
  • Hard commodities are mined, such as gold and oil.

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5 best commodity market ideas that can work in
India
  • Cautious to negative on MCX crude
  • Uncertainty factors could help MCX gold
  • Using bounces-to-sell strategy for copper might
    help
  • Going short-term negative on MCX zinc could be a
    good option
  • Long trade on NCDEX cumin on shortfall in supply
    could be a good option

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Cautious to negative on MCX crude
  • OPEC is finding it increasingly difficult to
    influence crude prices, which means that MCX
    crude could come under pressure.
  • Moreover, Russia has joined the OPEC consortium
    in terms of cuts in crude supply.
  • However, the US appears to enjoy a few clear
    distinctive advantages in terms of expansion in
    crude supply.
  • Further, Trump has already withdrawn from the
    Paris Climate Agreement, which opens significant
    opportunities for the US for undertaking
    substantial expansion of its shale capacity.
  • Thus, going cautious to negative on MCX crude.

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Uncertainty factors could help MCX gold
  • The World Gold Council has announced that the
    gold demand for 2017 will not be substantially
    more than the previous year.
  • Although India and China are the highest
    consumers of gold, gold prices will not be driven
    by consumption demand.
  • Moreover, volatility in North Korea and Middle
    East coupled with other global factors could
    influence the direction gold prices takes.
  • All these uncertainty factors could help MCX
    gold.

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Using bounces-to-sell strategy for copper might
help
  • The fact that copper has corrected for two weeks
    on-the-trot gives it a weak outlook.
  • Thus, waiting for a bounce in price to sell
    could be a good strategy.
  • Moodys recently downgrading China doesnt help
    copper prices either, since China contributes
    more than half of global copper demand.

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Going short-term negative on MCX zinc could be a
good option
  • Owing to environmental inspections, many zinc
    mines in the Hunan province of China were shut
    down. This led to subdued supply of zinc.
  • Post completion of inspections, zinc supplies
    have started flooding the markets, which has
    brought prices under pressure as well.
  • Moreover, strength of the US Dollar will weigh on
    MCX Zinc. Thus, going short-term negative on MCX
    zinc could be a good option

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Long trade on NCDEX cumin on shortfall in supply
could be a good option
  • With more than 70 of the worlds supply of
    cumin, India is the worlds largest producer of
    cumin.
  • Other cumin producer such as Syria and Turkey are
    much smaller. Exports of cumin in India are
    expected to remain buoyant despite higher prices
    of the commodity.
  • The commodity saw decent open interest gains,
    which again indicate towards pricing heading
    upwards. Therefore, long trade on NCDEX cumin on
    shortfall in supply could be a good option.

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Contact Details
  • To know more about commodity trading and for
    effective trading tips, please call us on
    91-22-2858 4545 or contact us at
    http//www.investmentz.com/
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