Thursday, 21 July 2016

Are you trading on MCX?

I have been trading on MCX for quite some time now.  I first started focusing on Gold, Silver and Crude oil, then included in this list Nickel, Copper, Zinc, and Lead. I decided to go slow and take my own time as trading commodities was very much new to me, so I chose only mini contracts to start with.  The reason is, I can afford my own lunch or dinner outside everyday but I cannot afford lunch or dinner with five other people everyday outside.  In other words, I can afford couple of hundred rupees loss per day but definitely not couple of thousand rupees of loss in my initial phase.  Survival should always be the first priority in trading and survival is only possible if there is enough capital to trade all the time. Capital will last long only if losses are very less and manageable.  

Now I can proudly say that I have got a grip on it trading with the DP method. It was possible only because of low risk of trading with mini contracts.

Here I give you an example of my trade today in Nickel Mini.  It was trading in the range ahead of expected new flow around 6 pm today.  Then it gave breakout, paused for a bit, and then gave nice BPB setup to go long. Possible target for the trade was around 6 points and I was able to keep SL of 1 point,  Everything was there for a good trade setup, low risk, high reward.  To no wonder it took just few minutes to reach the target.















To trade with mini contracts, you require less than Rs. 5000 for the MIS margin, SLs will not be more than couple of hundred rupees.  You just need to spend 2 to 3 hours in evening,  Isn't it better to start learning the trading with MCX this way rather than Nifty future?

The nicely made Video Tutorial will surely help you learn the day trading most efficient way.

7 comments:

  1. Replies
    1. Hi Sunil

      Glad to see you after a very long time. How are you? I miss those days when you, Peter Uzunov and I used to meet on Sundays for sessions.

      URD

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  2. URD, What is the best time in the day to trade MCX ? I have seen major moves come after 6pm.
    I wish NF too have mini contracts like MCX so that we learners could trade and gain confidence, though your strategy on options is also highly recommended.

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    1. Sourish

      You rightly said, most of action starts around 6 pm or an hour before US markets open. Many a times there are lot of news flow around that time in the US morning. All precious metals, energy and other metals give good moves. One can target 5 to 9 pm time slot for trading in commodities. You just keep a watch on two or three instruments. Most of the times you will be able to take at least couple of trades in that time period.

      I wish the same about mini contracts in NSE. Minis help new traders a lot during their learning phase. Most of the traders have not yet realized the potential of trading in Nifty options. Nifty Options are the only instrument to trade on NSE, I believe. Here your risk is never more than 6 to 7 points (around Rs. 500) and brokerage and taxes are less than Rs. 20. So you will never lose more than Rs. 500 per trade. But unfortunately traders who trade Futures have not realized that. We do trading as business. Trading is not for fun or time pass or for thrills. It is a serious business and all things need to be considered before risking a penny.

      URD

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    2. Thanks URD for the reply.

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  3. Thats great to see DPs working across markets.
    Kindly post Nifty charts- even if no trade action day- for learning.
    The Video you mentioned in the post takes it to your blog. However the link see the video or if it is paid, the cost etc is not accessible. May we request you to guide the interested parties suitably. Thanks and keep this good work!

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    Replies
    1. Anand

      Price action trading works everywhere. You just need to adjust a bit per the requirement of the instrument that you wish to trade.
      It is not possible for me to post every day. There are lots and lots of things that are going on currently. I hardly get time.

      There are two video tutorials as mentioned there. Both are paid. You can mail me to inquire the cost. It is very much affordable and it will save your at least 3 to 4 years and lakhs of rupees.

      URD

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