Difference between commodity trading and forex?

I was wondering the major difference between commodity trading and forex? Are the two similar?

Was wondering if we had any commodity traders on here?

There are quite a few differences between spot forex and commodity futures. Spot markets are cash markets - "here and now". Commodities trade via futures contracts. These contracts standardize the price, date, and delivery of an underlying "thing" or asset, such as corn, oil, T-bonds, or even single stocks.

Note, there are also spot markets for commodities, but when you buy 500 bushels of corn in the spot market you should expect to take immediate delivery of a LOT of corn. Hope you are hungry.

There are also futures contracts written for currecies, the same currencies we trade in the spot FX market. However, you are merely trading a futures contract, not buying a specific amount of one currency and simultaneously selling a specific amount of another currency (the pairs) like in the spot market.

Futures contracts also expire. Depending upon certain factors, you could theoretically hold a spot position indefinitely. However, at some point in the future, you will need to make or take delivery of the assets the contract is written for. In essence, sooner or later the future will be the present, and if you are long a corn contract and hold it until expiration you will find yourself the proud owner of 5000 bushels of corn that you now need to arrange for pick-up, most likely in a grain warehouse southwest of Chicago. Hope you're hungry and have a big SUV. Most futures contracts, as you may guess, are never held until expiration.

Also, there are "intermediaries" involved in futures trading that are there to ensure performance of each party to a trade. Much like FX trading, there is always a counterparty to your trade. For every long position in a futures trade, there is a short. However, no one would trade futures if there was the possibility that 5000 bushels of corn would not be delivered in defiance of the contract specifications. There are no such intermediaries in spot FX since there is no requirement for contract performance.

Finally, in my opinion: price fills. While spot FX and futures markets are always subjected to normal slippage, a futures broker may not play the same games with you like retail FX brokers routinely do. A quoted price in futures trading is the price that another party stands ready to buy or sell (depending upon volume). A futures broker is not a counterparty to your trade as in spot FX. They are your agent. A retail FX broker clearly discloses the fact that they are the counterparty to your trades - read the fine print in your account opening documents. You trade against your broker in retail spot FX, you do not trade against your broker in futures.

I am sure there are commodity traders here on the forum. I aspire to one day play at this level as I find trading with a retail FX broker to be slightly less of a headache than a visit to the department of motor vehicles.

-=DAVE=-

I am looking for traders that trades beyond currencies; commodities / stocks.

Can you tell me if the technicals / forecasting that I perform are transferable or even useful in these other markets? The tools and studies maybe the same, but the forecasting aspect in using the tools used - is that exactly the same process?

Break of trendlines, S/R levels, pivot points, Fibs, etc - is it similarly applicable? Thank you for your input.

Hello
I'm a beginner trader. Tell me please, where can I find information for analysis of comodities tools? I want to trade sugar, cocoa, coffee, cotton, orange juice futures.

Thanks

Go to CME and you'll find all the info. Chicago Mercantile Exchange.

You can start with the tools on the exchange website as Alert mentioned. Also try Google, you will find some useful resources there to get you started, (http://futures.tradingcharts.com/edu..._resources.php) I found this quickly. Although Google is not what it used to be before as the quality of results are deteriorating.

The commodities you mentioned mostly trade on ICE (Formerly NYBOT, although the name is still there). They are some of the least known/traded commodities within the retail space, so you would better learn a lot about them as mostly professionals are the ones trading those (Unlike other commodities like Crude Oil, Natural Gas, Corn, Soybeans, etc...).

For one of the best analysis websites for commodities, try https://www.barchart.com/, they offer charts, news, analysis and a lot more. They also provide a large education section where you will really need a LOT of time to read and digest, but it's worth it, I highly recommend it (https://www.barchart.com/education/technical-indicators).

Hi I am bigginer who's still on a demo can u please help me on what caused the dollar to fall against all measer currencies while the interest rate was raised

Hi guys, sorry for the question as I couldn't open a thread because I'm new. I have one question: is it normal that the spread goes from 3pips to 35pips in a fraction?

Hey Dave thanks for your detailed explantion. And after reading this it got me to a question. Lets say i buy a contract of 500 bushels of X that expire April2018. So this contract can be traded back and forth as many times as someone is willing to buy and sell. So now we are getting closer to expiry date now i can imagine most traders want to let go their position BEFORE the contract expires, right and less people are willing to buy? Will price go down?
As you can see ive never given lot of thought into futures but would like to know what is the case here.

Thanks and happy tading,

B00bies