When purchasing commodities futures do you just buy the front month and roll it or do you take a longer position? In August, I paper traded Lumber futures and did well but not sure how I'd have structured an actual trade. I do think lumber has the possibility to rise again in 2022 but it might come back down over the next couple of months in the meantime but that's just my feeling. I've been doing very well paper trading and have started to take some trades but they less than 10% of my cash.
HK_L61
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@happyCloud1537, Oh my... that is a very loaded question...
You want to measure the CURVE, understand the spreads.
.......... that said..........
Trading the Front Month while you are learning is BEST Practice.
One footstep at a time... Keep it as simple as possible, Make $ on your setups, don't get caught in what is beyond your understanding at present, this requires... time, patience and far more screen time.
Vixtine
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@HK_L61, Makes total sense...watched a couple videos online regarding Contango & Backwardation but futures are still beyond my comprehension and I'm not 100% sure I understand those words. I am doing well with the front months right now so baby steps.
HK_L61
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@happyCloud1537, It is very simple.
Contango Month 1 is less than Month 2, less than Month 3, less than Month 4
Backwardation - Prices are LOWER not HIGHER for out months... m2 - m4 - m6
Baby Steps, learn to trade Front Month.
I'll send you some resources later via TG when you are ready