Initiating a thread for better understanding the commodities market. Why is this important ? Understanding who trades in a market, how, when and why can be used to provide for large profits.
For example, there are systems used in the index based futures market based on how MMs can influence opening price. Another great example of using market structure is exploiting stop cascades and option barrier hunts in the currencies.
An understanding of how a market works is critical. Hypothetical example being if price discovery never takes place in a index futures market, it would be useless to trade S&R in that market. You could only benefit by taking signals from the underlying stocks in such case.
I do have a bit of information on how price discovery takes place on the MCX and will post my ideas if there is enough interest.
A few questions for discussion now
1. Who are the largest players in the various precious metals ?
2. How do the largest arbitrageurs work ( MCX prices vx. international prices)?
3. For commods where does price discovery happen ? Spot or futures? Which one leads?
4. How do commercials use the MCX?
For example, there are systems used in the index based futures market based on how MMs can influence opening price. Another great example of using market structure is exploiting stop cascades and option barrier hunts in the currencies.
An understanding of how a market works is critical. Hypothetical example being if price discovery never takes place in a index futures market, it would be useless to trade S&R in that market. You could only benefit by taking signals from the underlying stocks in such case.
I do have a bit of information on how price discovery takes place on the MCX and will post my ideas if there is enough interest.
A few questions for discussion now
1. Who are the largest players in the various precious metals ?
2. How do the largest arbitrageurs work ( MCX prices vx. international prices)?
3. For commods where does price discovery happen ? Spot or futures? Which one leads?
4. How do commercials use the MCX?