Spread trading in Meta Trader - page 239
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Yesterday's grain trading opened with a strong Downside spread move towards seasonality:
Let's see how the movement goes further....
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Off-topic, but - I think - useful information for commodity trading enthusiasts. Below are excerpts from a seasonal sugar review I wrote for Pantheon-Finance)
==== Sugar outlook for January ====
(fragments of seasonal review)
At the moment, the movement of SB quotations is largely determined by the cane harvest and processing in South America. Sugar prices have fallen markedly in the last week, which can be attributed to a good current outlook for the current Brazilian sugarcane crop! The pressure was also exerted by increased sugar production in Brazil and a Kingsman SA report, which showed a significant increase in world stocks!
Meanwhile, from the second decade of January, there is a seasonal increase in sugar until the middle of the third decade of the month, which is clearly visible in the average graph of multi-year seasonal (3-5-10-year) trends :
The impetus for this seasonal increase could come from the rainy season in South America, which could put the brakes on production activities in this region.
Let's take a look at the seasonal statistics for such "sugar" buying from tomorrow, i.e. January 11-25. Below is a table of statistics for the now most liquid March sugar contract SBH3 over the last thirteen years. The figures (SB scale dimension) look quite positive:
The average multi-year profitable buying potential is +115 points (ticks) on the SB scale! At the same time, the possible average loss (in case of a negative development for us) was only -25 points (ticks)!
It is clear, that this entry(BUY SBH3) for small deposits in MT4 is beyond doubt! It remains only to find the optimal entry point within the day -by means of standard technical analysis.
For that, let's look at the current situation, which is shown in the chart below. Today's sugar trading opened with a small gap up. Let's wait for a small Down-bounce of the price and assess the situation for buying the instrument!
Yesterday's grain trades opened with a strong Downward move of the spread towards seasonality:
Let's see how the movement goes further....
The consistent movement of the ZW-ZC (wheat-corn) spread towards seasonality is pleasing! Slowly but surely the spread line is profitable downwards!
However, I would like to remind you that the USDA (US Department of Agriculture) grain report is coming out this evening. Significant multidirectional movements of grain instruments are expected on the data release. I plan to partially close spread positions shortly before the news. In order not to risk existing profit.
leonid553, could you please tell me what is your indicator for 8 horizontal lines?
Don't be stupid.
leonid553, could you please tell me what is your indicator of 8 horizontal lines?
The average multi-year buying profit potential is +115 points (ticks) on the SB scale! While the possible average loss (in case of a negative development for us) was only -25 points (ticks)!
It is clear, that this entry(BUY SBH3) for small deposits in MT4 is beyond doubt! It remains only to find the optimal entry point within the day -by means of a standard technical analysis.
Sugar is on the rise and has broken through all the lows while floating -73p
Yeah, I know...
But on the other hand, it's called SPREDA trade!!! :-)
"Where the truth is brother" (c)
True on the lower chart, in the indicator window!
Because youdid not build the spread correctly on the barchart website! There you have to build the spread according to the formula - which is shown in pale grey at the top left in the indicator window! Taking into account different specification parameters and dimensions of these instruments!
1*100*GCG3 - 1*5000*SIH3 (for position size ratio = 1:1)
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And actually, you should work with this spread with ratio GC-S1=2^1...