▌Commodity Fundamentals

Commodity Fundamentals

MCX Metal 







MCX Energy 

Crude Oil

Natural Gas

Explanation of commodity fundamentals – 

Commodity fundamentals have been explained here for Market, MCX, MCX Crude, MCX Aluminium, MCX Copper, MCX Natural Gas, MCX Nickel, MCX Gold, MCX Zinc, MCX Lead, MCX Live. These will be very beneficial to understand the metal commodity and energy commodity of MCX. Fundamentals and factors which influence the price of commodity are also explained here. In a market economy, price is determined by the interaction of supply and demand. The study of supply and demand is also known as the study of fundamentals or “fundamental analysis”. In this section you will learn how to estimate a market price for commodities using the law of supply and demand as reflected in the “stocks to use ratio”. The stocks to use ratio is a closely watched figure in when establishing asking prices for commodities. In order to understand stocks to use, you must understand the economic theory of supply and demand. Supply and demand graphs are useful tools used to illustrate this concept.

Fundamental analysis is a means of examining commodities in an attempt to predict the future path of least resistance for prices. The basis for fundamental analysis is supply and demand.Supply and demand amount to a simple equation. However, things get more complicated when you try to forecast prices for the future. Commodities trade in cycles. Sometimes supplies will be tight and prices high. Other times, there is just too much of a commodity and prices fall.I like to look at commodities that are trading at multi-year highs or lows. Eventually, the picture tends to change leading to a profitable trading opportunity. Price movements in commodities using fundamental analysis can be broken down into simple formulas:

  • Demand > Supply = Higher Prices
  • Supply > Demand = Lower Prices
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