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Steps to begin crude oil trading
If you think you would like to trade energy CFDs, you should take a step-by-step approach.
Once you complete these steps, you will be ready to open your first energy trading position.
- Start by selecting the right oil trading platform
A full-featured trading platform like MetaTrader 4 (MT4) or IRESS provides you with advanced charting features, indicators, and access to important data. Commodities markets react to news or trading signals very quickly, so you need to have the necessary information to make trading decisions. Also, you need a platform that allows immediate execution of trades. Both these highly customisable platforms offer these qualities, and TMGM offers accounts for IRESS and MT4.
- Choose a reputable broker This is where we come in.
The CFD industry has many unregulated brokers who lack quality and fail at customer service. Luckily, we also offer 24/7 support, liquidity, fast execution, and transparent pricing. We clearly explain our pricing and features and are regulated by recognised organisations.
- Find oil trading markets
Most traders seek energy CFDs that track spot markets. The options for crude oil trading are usually Brent and WTI crude, which have the symbols of XBR/USD and XTI/USD, respectively. These markets offer more accurate pricing and are ideal for both technical and fundamental analysis strategies. Also, they do not experience wild speculation that sometimes occurs in energy futures markets.
- Learn and test your strategies
Commodities trading is challenging, so you need to establish rules for when to open and close positions. These strategies could involve chart patterns, indicators, news reports, output or extraction data, or a combination of these factors. You can use a demo account to test your ideas and determine the most effective ones.
Frequently Ask Question
Oil CFD prices change depending on several factors, the most
obvious being supply and demand. Events that can increase or
decrease supply and demand include:
- Refinery shutdowns, oil pipeline issues, or conflicts that limit oil extraction and export.
- A country deciding to reduce their oil output. News reports and other announcements can indicate when these decisions may occur.
- Decisions made by the Organisation of the Petroleum Exporting Countries (OPEC) can also affect oil prices.
If you trade CFD products, you can enjoy several advantages,
including:
- These products provide access to spot markets, which are typically out of reach for individual retail traders.
- Energy CFDs have low capital requirements.
- CFDs allow you to use leverage to target profits from small market moves and take larger positions with limited capital.
Crude oil is the most liquid energy market, and you will have a wealth
of information, data, and reports to inform your trading.