The Importance of Commodities in Forex

The Importance of Commodities in Forex

Commodities impact us every day. The changing price of such commodities as gas, lumber, gold can affect our day to day decisions. They can also make us money.

What you can learn in this article

  • What is the importance of commodities for forex trading
  • How to take advantage of forex watching the prices of commodities
  • How to improve your performance in forex using AI trading
forex trading

Because changing commodity prices also impact the forex market, learning how to take advantage of the positive and negative effects commodities have can help you succeed in your trading goals.

Commodities are goods that can be traded all over the world for other commodities or money. These commodities can be traded directly in the Futures Market or indirectly in the Stock Market.

The stock market allows investors and traders to participate in commodity trading through Exchange Traded Funds (ETFs).

When the price of a commodity goes up, the affiliated ETF goes up as well.

Price changes in commodities also influence currency exchange rates. Countries that produce tradable commodities benefit when the price of that commodity goes up.

Anything good for the price of the commodity is usually also beneficial to the country in which it is produced because the exchange rate of the currency in that country becomes more desirable.

Next to interest rates, commodity prices have the greatest influence on forex market rates. The two top commodities that have the highest impact on any given commodity are oil and gold.

Countries that produce one or both of these commodities in significant amounts are affected by the price changes of those commodities.

For example, if the price of oil increases, the currencies of oil-producing countries also increase in comparison to the US dollar.

Nowadays, the top two countries (and currencies) affected positively by increases in the price of oil are Canada (CAD) and Great Britain (GBP). Australia (AUD) is also affected to a lesser extent. Conversely, the Yen (JPY) is negatively correlated to oil. If oil goes up, it goes down.

Knowing this is one way that users can get an advantage in the market. By looking for automated AI-Trading or A-Signals that move in the same direction as well-correlated markets, users can expect to have the wind at their back so to speak.

For example, suppose you noticed the strong positive correlation between the Canadian Dollar (CAD) and the price of oil. Suppose further, you’ve also noticed the strong negative correlation between the price of oil and the Japanese Yen (JPY). You would be very interested in any trade that was long on CAD/JPY because you knew that has a major trend behind it.

The chart below is an example of how a commodity correlates to forex trading. The price of oil (red line) is trending higher, and the correlation between the price of oil and the EUR/CAD pair is shown in the red histogram study below the chart.

Since the histogram shows that most of the correlation is below the zero levels, it establishes the fact that the EUR/CAD is negatively correlated to the price of oil.

Commodities in Forex

Therefore, if the price of oil is trending higher it is also true that short trades on the EURCAD are likely to do well .

The best way to trade forex

There are two ways to invest with our AI in forex:

1. Automated with AI-Trading. Check out the 3 steps to trade automated with our AI.

automated trading with ai bot

By trading forex automated with AI, you will save time and improve your performance without monitoring the market and managing trading platforms.

With Automated AI trading you do not need MT4 / MT5 and other trading platforms to invest in forex. All forex trades are automatically placed into your broker account every time that our AI system identifies a new worthy trading opportunity. You can monitor the AI trading performance in real-time directly on our dashboard.

Automated AI trading benefits

  • Setup in 3 minutes.
  • Totally hands-off, from anywhere.
  • Invest from just $100.
  • APY of 40% over the past 13 years*.
  • Lightning-fast execution & no slippage.
  • No commissions, no management fees.
  • Portfolio with 40 different automatic strategies.
  • No MT4/MT5 or other platforms required.
  • Test with a risk-free practice account.
  • Trading results directly on our dashboard.

Don’t you have a broker account yet? Our AI is integrated to trade automated with the broker FXCM. Click here to open an account.

2. Manually with AI forex signals.

Wiseinvest also provides AI forex signals that perfectly fit into MT4, MT5, and any trading platform. To trade with our AI forex signals, you must simply copy the data you receive from each real-time signal into any forex brokerage account of your choice.

There are five unique variables for each AI signal, and each must be copied exactly, in order to match the performance of the signal as close as possible.

Each AI forex signal alert consists of the following five data points:

  • Symbol (forex pair)
  • Direction (long or short)
  • Position size (number of units or lots)
  • Take profit (price level to exit with maximum gain)
  • Stop loss (price level to exit with maximum loss)

Check out how to trade with our AI forex signals.

  1. Subscribe to a Wise-Plan.
  2. Open a Brokerage account. Check this article about the best forex Brokers.
  3. Set an amount and a position size on our Wiseinvest dashboard.
  4. Our AI will send you real-time trading alerts by email and Telegram.
  5. Copy the signals and paste them into your Brokerage account.

All forex signals are sent every time that our AI trading system identifies a new trading opportunity. Our trading strategies are developed on a variety of time frames such as 4 and 8 hours.

Wiseinvest AI forex signals are Market Orders and you do not need the entry price. You can copy each signal while it is available on our dashboard. We do this way to assure that traders will just place signals while they are good to be traded.

You can trade forex with our free forex signals clicking here, or with our Premium subscription that provides you unlimited AI signals and automated AI trading in partner brokers. Whether you are a beginner or a professional forex trader, our AI trading system can help you save time and improve your trading performance. Get started with free AI.

When investing through Wiseinvest automated AI trading or AI forex signals, you do not need to calculate pips and change the leverage in your forex broker account. Learn more about leverage in forex trading clicking here.

What is the AI performance in forex trading?

The Win Rate of our AI shifts as indicated by the period and can reach up to 95%. The performance depends on the proficient wilderness estimation metric, which implies that our model is beneficial at whatever point the Win Rate is more prominent than 60%. All techniques of our AI Trading framework look for stable returns and adequate outcomes to accomplish a normal return of 40% every year (APY), without the utilization of high influences.

We comprehend that what is important in forex trading is the conclusive outcome. Along these lines, the financial specialist needs to consider that Win Rate isn’t generally the best measurement to gauge execution in forex, as other signals suppliers unveil. For example, out of 100 exchanges, it is conceivable that lone 1 exchange is sufficient misfortune to make the 99 exchanges not productive. For this situation, the Win Rate would be 99%, yet the conclusive outcome would be unfeasible (negative).

We center around the arrival of 40% of APY and not simply on Win Rate.

It is basic to see that forex brokers may charge spreads, commissions, and overnight expenses in your trading account, and these elements can influence the AI execution. You can check our forex trading history to see more about AI Trading execution clicking here.

How much do I need to trade forex with AI?

You can begin in forex trading with free AI signals or AI Trading records and make a store from only $100 in the brokerage. It is likewise conceivable to test utilizing a hazard-free practice account with our AI Trading framework. In any case, so as to do a proficient hazard the board in genuine records, we recommend you start from at least $100. Notice that some forex brokers require diverse starting stores to trade forex.

What is the trading strategy of our AI?

Our AI procedure is the mix of various AI Trading frameworks, with in excess of 100 features, that characterize 40 trading strategies which at the same time consider: Quotes of the 28 forex pairs, Supports, and Resistances in various time periods, Trends and Counter-patterns, Cross-markers, Index of each pair, Economic Calendar, Investors Sentiment.

Our AI examines those fundamental, technical, and sentiment factors that influence forex trading, and all models are assessed continuously utilizing various loads. In the wake of finishing the investigation, the decision of the signal emanation technique is made considering the improved probability of momentary benefit and the sum accessible for speculation.

Using technical analysis, our calculation considers not just the examples of different patterns, including backing and obstruction levels and cross-pointers, yet our AI is likewise ready to make its own ongoing record for every money pair, that is utilized to distinguish what is the best course and target.

Comparable to fundamental analysis in forex, the AI makes a connection inside the financial schedule to discover news information that can influence explicit cash sets.

Disclaimer: Forex and Contracts for Difference (CFDs) are complex instruments and come with a high risk of losing money due to leverage. Forex trading is not suitable for everyone. You should consider whether you understand how forex and CFDs work and whether you can afford to take the high risk of losing your money.

The forex brokerages displayed shall disclaim the overall performance of traders in their platforms. Oanda warns that 76.8% of retail forex traders lose money trading CFDs. XTB warns that 80% of retail forex traders lose money trading CFDs. FXCM warns that 74.74% of retail forex traders lose money trading CFDs.

The performances aforementioned are not related to Wiseinvest AI forex trading and AI forex signals system. You can check the performance of our AI forex system on our dashboard.