Saturday, May 06, 2006

Invest In Energy Markets and Make Huge Profits

The recent move in crude oil to all new time highs has shown the potential to be made trading energy markets and many savvy traders make triple digit gains or more!

If you want to get involved in energy markets and get a share of this profit potential then this report is for you, even if you have never traded energies before.

Let’s look at these exciting markets and one move that could yield even bigger profits than crude oil!

Why trade energies?

Quite simply, they offer a speculators dream that includes the following advantages

1. Trending nature

Energy markets trend longer term and traders can lock into these trends for huge profits.

2. Profits in bull and bear markets

Traders can buy or sell energy contracts depending on their view and this gives constant opportunities for profit.

3. Volatility & liquidity

Energy drives the world economy and by its very nature is volatile and price swings are always present.

Liquidity is high (crude for example is the biggest commodity market in the world) this means that positions can be opened and closed quickly to lock in profits and limit losses

4. Seasonal trends

Many energy markets exhibit highly reliable seasonal trends due to consumption patterns. For example, unleaded gasoline demand is highest in the summer holiday driving months and heating oil demand is strongest in the winter months

What vehicle should I use to trade energy markets?

With energies there is the possibility to make large rewards however with reward goes risk.

Risk management is critical to long term success in trading any volatile market. The “safest” method to trade these markets is by options, which offer unlimited profit potential and limited risk.

How should I trade?

Energy markets to exhibit reliable trends and the best way is to use a technical trading system that simply follows the trend. There are many good simple systems that can be used.

I Missed the recent bull move up in crude oil have I missed the boat?

There are always trends to take advantage of, so the fact you have missed one does not mean others will not come around.

Here is a quick outlook for energies, that includes a market that could take off shortly and give far bigger profits than crude oil!

Crude oil

Prices should remain firm as demand exceeds supply, add in geo political concerns in major oil producing areas such as the Middle East and prices can go higher.

Pullbacks therefore represent buying opportunities.

The same applies to heating oil and unleaded gasoline that are ideal markets to trade from a seasonal point of view.

Natural Gas

Natural gas could take soar in value simply because crude and its products have increased so much in price. Natural gas has the following advantages:

1.It is a clean fuel and environmentally friendly
2.It is produced in the US ( and is not imported ) and is therefore free of geo political concerns that surround oil
3.It is relatively cheap in price

With the US looking for alternative energy sources, a buy and hold strategy in natural gas could yield huge long term gains.

While natural gas is plentiful in the long term in the short term demand is exceeding supply and this scenario looks to be in place for the next few years.

With a rising demand and supply already short we have the perfect scenario for higher prices.

Energies the perfect markets to seek huge gains

Energy markets offer great potential for profit for traders with risk capital and represent an ideal diversification away from traditional investments such as stocks and bonds.

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