Technical analysis works on MCX commodities?

chethan

I use technical analysis for equity trading. Does same technical indicators like RSI, MACD, Moving averages work on commodity futures also? Or commodities need different approach?

chethan

Reply by: ChartistTrader_Delhi
Technical analysis works on commodities but you need to adapt to each commodity's characteristics. For example crude oil reacts to geopolitical news more than technical levels. Gold respects technical levels quite well. Agricultural commodities have seasonal patterns which you need to combine with technical. Overall I would say 60% fundamental and 40% technical works best in commodities.

chethan

Reply by: PureTA_Trader
I disagree, I trade purely based on technical analysis and making consistent profits in MCX. Support resistance, candlestick patterns, trend lines everything works if you apply correctly. News and fundamentals are already discounted in prices. Just need to read the chart properly and have discipline to follow your system.

chethan

Reply by: HybridTrader_Chennai
Both approaches have merit. I use technical for entry and exit timing but fundamental analysis to decide direction and position size. For example if fundamentals are bullish on gold, I wait for technical buy signal to enter. This combination has worked best for me over 5 years of trading.