Hello everyone.
I’m new here. I’m just wondering is energy trading (crude oil) using the same concept as forex? Analysis, indicators etc.
Thanks!
Hello everyone.
I’m new here. I’m just wondering is energy trading (crude oil) using the same concept as forex? Analysis, indicators etc.
Thanks!
Yes… and No. Some of the concepts you learn in Forex trading are applicable, and some are not. I’d say that psychology and money management can be applied to either absolutely, but there are differences in the fact that one is a commodity and the other is a financial ratio of two distinct currencies. Oil news can affect the USD/CAD or even other pairs, but the differences are subtle. Start with BabyPips School of Pipsology before getting complicated.
I see. Thank you for the explaination. Yeah, I’m currently in the program.
If you are trading crude it pays to have a little knowledge about geopolitics
.
Nothing to drastic but events in Nigeria, Venezuela, the straits of Hormuz can trigger price moves.
Also US hurricane season can be a big influence at times.
I’d say 50% geopolitics 50% dollar related is how this market functions
Thank you for the info.
What about indicators? Can I use them like I use to trade forex?
You can - how effective they are will come down to your methodology regardless of market.
All markets have their own personality.
You’ll find some markets are ‘better’ than others with certain trading tools.
One of my biggest headaches as a trader has been trying to understand why some markets trade well with my chosen tools and others dont. I still don’t understand and likely never will.
For what is worth though I think commodities generally trade ‘better’ than FX. I find the trends on all time frames clearer, with less back and filling and whipsaw.
That’s a sweeping generalisation and is open to debate - but it’s my personal experience.
Not all concepts will work the same. Since the currency pairs are driven by overall economic movements, energy trading affects the forex market. But their movements and trends will not be the same in all cases.
I did not understand your question