Commodity Trading in India: A Beginner’s Guide to Earning from Gold, Oil & More

🟡 Introduction to Commodity Trading

✅ What is Commodity Trading?

Commodity trading means buying and selling raw materials like gold, crude oil, wheat, cotton, etc. These are called commodities because they are standard items used globally and have value. Just like people invest in stocks or mutual funds, they can also invest or trade in commodities — especially through commodity exchanges.

Imagine this: When you buy gold jewelry, you are buying a commodity. But in trading, instead of physical gold, you trade the price of gold to earn a profit.

Commodity trading is done through futures contracts, where you agree to buy/sell a commodity at a fixed price on a future date. You don’t need to physically take delivery — most people trade for profit based on price movements.

Why Commodities Matter in the Indian Economy

India is one of the world’s biggest users and producers of many commodities:

• We import large amounts of crude oil

• India is the second-largest consumer of gold

• We are a major exporter of rice, wheat, and spices

That’s why commodity prices impact everyone — from farmers to businessmen, and even common households. When crude oil prices go up, fuel prices rise. When gold becomes expensive, jewelry costs more. Traders can use this price movement to earn profits or protect themselves from losses (hedging).

🧺 Real-Life Example: How a Farmer and a Trader Use Commodities

Let’s understand with two simple examples:

👨‍🌾 Farmer’s Story (Hedging)

A farmer expects to harvest 1000 kg of wheat in 3 months. But he fears the price might fall. So, he sells wheat futures today at ₹2,200 per quintal on the NCDEX. After 3 months, if the price drops to ₹2,000, he still gets ₹2,200 because of his futures contract. He protected himself — this is called hedging.

📈 Trader’s Story (Speculation)

A trader thinks gold prices will rise due to global tensions. She buys gold futures at ₹58,000 per 10 grams. After 10 days, gold rises to ₹60,000. She sells her contract and earns ₹2,000 profit per lot. This is speculative trading — trading to earn profit from price movements.

🔑 Key Takeaway

Commodity trading lets you earn from price changes in essential goods — even without buying them physically.

Whether you’re a student, a housewife, or someone looking for a second income, commodity trading is open to everyone above 18 years with the right account setup.

🏷️ Types of Commodities Traded in India

India offers a wide variety of commodities for trading. These are divided into two main categories — Hard Commodities and Soft Commodities.

Understanding these types helps you choose the right commodities to trade based on your interest, capital, and market conditions.

🔹 Hard Commodities

These are natural resources that are mined or extracted from the earth. They are globally traded and highly influenced by international events like wars, natural disasters, or economic news.

🛢️ 1. Crude Oil

• Traded on the MCX (Multi Commodity Exchange)

• Affects fuel prices, transportation, inflation

• Prices are volatile — ideal for short-term traders

🪙 2. Gold

• India’s most popular trading and investment commodity

• Traded in standard lots (1 kg), mini (100g), micro (10g)

• Price moves based on global demand, USD value, and inflation

🥈 3. Silver

• Cheaper than gold but also volatile

• Used in jewelry and industrial sectors

• Good for short-term and long-term trades

🔋 4. Natural Gas, Copper, Aluminum, Nickel, Zinc

• Called base metals

• Used in construction, wires, batteries, etc.

• Prone to price movements due to industrial demand

 

🔸 Soft Commodities

These are agricultural products or livestock. Prices depend heavily on weather, monsoons, government policies, and exports.

🌾 1. Wheat

• Staple food in India

• Prices influenced by harvest, stock limits, export rules

🌿 2. Cotton

• India is one of the top cotton producers

• Prices fluctuate with demand from textile industries

🧂 3. Spices (Jeera, Turmeric, Cardamom)

• Mainly traded on NCDEX

• Affected by monsoon, pest attacks, export trends

🌻 4. Oilseeds (Soybean, Mustard)

• Used in cooking oil and animal feed

• Prices can spike in case of low rainfall or crop damage

 

📋 List of Popular Commodities Traded in India

Note: Margins vary by broker and market volatility

📌 Pro Tip for Beginners

Start with gold or crude oil. They are liquid (easy to buy/sell), have lots of data available, and are beginner-friendly.

💡 Summary

⚙️ How the Commodity Market Works

To succeed in commodity trading, you need to understand how commodities are traded, where they are traded, and what makes their prices move. This section will explain all that — with examples — in simple terms.

🧾 Spot Market vs Futures Market

🟢 Spot Market:

• Commodities are bought and sold immediately

• The delivery and payment happen “on the spot”

• Used mainly by farmers, wholesalers, and manufacturers

• Example: A farmer sells 1,000 kg of wheat to a local buyer at today’s price

🔵 Futures Market:

• You agree today to buy/sell a commodity in the future

• Used by traders and investors to speculate or hedge

• You don’t need to take or give delivery — most traders just square off before expiry

💡 In India, commodity trading is mostly done through futures contracts.

📜 How Futures Contracts Work (Explained Simply)

A futures contract is an agreement between two parties to buy/sell a specific quantity of a commodity at a fixed price on a fixed future date.

Example:

• You believe crude oil price will rise from ₹6,500 to ₹7,000 per barrel.

• You buy 1 futures contract of crude oil at ₹6,500.

• If the price reaches ₹7,000, you sell it and earn ₹500 × lot size.

• If it falls to ₹6,200, you may choose to exit with a loss.

⚠️ You don’t need to pay ₹6,500 — only a small margin (around ₹5,000–₹10,000 depending on broker and volatility)

📏 Key Terms: Lot Size, Tick Size, Expiry

 

🏦 Commodity Exchanges in India

These are regulated platforms where commodity contracts are traded, just like stock exchanges.

🔷 1. MCX (Multi Commodity Exchange)

• Most popular exchange in India

• Deals in metals, energy, bullion (gold, silver)

🟠 2. NCDEX (National Commodity and Derivatives Exchange)

• Mainly focuses on agricultural commodities

• Trades in wheat, jeera, soybean, cotton, etc.

🛡️ Regulated by: SEBI (Securities and Exchange Board of India) — ensures safety, transparency, and fair practices.

 

 

💥 What Affects Commodity Prices?

Commodity prices are influenced by many factors, such as:

 

🔄 Real Example: How Gold Prices Move

Let’s say:

• The US Federal Reserve raises interest rates

• The USD becomes stronger

• Gold, which is priced in USD, becomes expensive for Indians

• Result: Gold prices in India may fall, traders react to this

 

🔑 Key Takeaway

The commodity market operates through regulated futures contracts, with price movements based on real-world events, global trends, and economics.

Understanding the market mechanics will help you predict price moves, manage risks, and plan better trades.

👤 Who Can Trade Commodities in India?

You don’t need to be a financial expert or a big investor to trade in commodities. Anyone who meets the basic criteria can start — even a student above 18 with a PAN card. Here’s everything you need to know.

✅ Eligibility Criteria to Start Commodity Trading

To trade legally in commodities in India, you must:

☑️ These are standard requirements by SEBI (Securities and Exchange Board of India)

📂 What is a Commodity Trading Account?

A commodity trading account is like a pass that lets you buy/sell futures on commodity exchanges (like MCX and NCDEX). You open this with a SEBI-registered broker — just like a stock trading account.

You’ll get access to:

• Market depth (live bid/ask)

• Charts and tools for analysis

• Order placement options

• Reports and contract notes

 

💼 Do You Need a Demat Account?

In most cases: No.
Commodity futures are settled in cash and don’t require a demat unless you want physical delivery (rare for retail traders).

 

🛠️ How to Open a Commodity Trading Account

Here’s how easy it is:

1. Choose a best commodity broker such as Dhan or Upstox

2. Complete online KYC (takes 10–15 mins)

3. Submit:

   • PAN card

   • Aadhaar card or Voter ID

   • Bank details

   • Selfie or live video

4. Wait for approval (usually within 24 hours)

Once approved, you can log in to the trading platform and start trading commodities.

🔗 Difference Between Demat & Trading Account

 

📝 Real User Example

Ravi, a college student, opened a commodity account with Dhan using his PAN, Aadhaar, and bank account. With just ₹2,500 in margin, he placed his first crude oil trade — and exited the same day with a ₹180 profit. He didn’t need a demat account.

🧠 Pro Tip

Always choose a broker that offers zero or low brokerage, a user-friendly mobile app, and instant fund transfers such as Dhan

🔑 Key Takeaway

Anyone 18+ with basic documents can start trading commodities in India through a broker. You don’t need a demat account unless you plan on taking delivery.

If you’re looking for a modern, feature-rich, and trader-friendly platform, Dhan is easily one of the best choices available today. From zero account opening charges to advanced tools like native TradingView, options strategy builder, and free API access, Dhan is clearly built with the modern Indian trader in mind.

Whether you’re an intraday trader, an options strategist, or a long-term investor, Dhan offers the perfect blend of speed, simplicity, and smart technology — without burning a hole in your pocket.

Why wait? Open your Dhan account now and take control of your trading journey with confidence.

👉 Click here to get started with Dhan

🛠️ How to Start Trading in Commodities in India (Step-by-Step Guide)

Getting started with commodity trading is easier than ever in 2025. Here’s a simple, beginner-friendly guide you can follow — even if you’ve never traded before.

To trade legally in commodities, you must register with a broker who is a member of MCX (Multi Commodity Exchange) or NCDEX (National Commodity & Derivatives Exchange).

This section is your action roadmap — what exactly you need to do (and avoid) to begin your commodity trading journey in India.

🏦 Step 1: Understand the Exchanges – MCX and NCDEX

India has two main commodity exchanges:

✅ For most beginners, MCX is where you’ll start.

 Choose a SEBI-Registered Broker

🔍 Popular Brokers for Commodity Trading in India:

💡 Tip: For beginners, start with brokers like Dhan or Upstox due to lower costs and easier onboarding.

📄 Step 2: Open a Commodity Trading Account

Once you’ve selected your broker:

1. Visit the broker’s website or app

2. Select “Open Commodity Account“

3. Complete KYC (e-KYC through Aadhaar/PAN + selfie)

4. Link your bank account for fund transfers

5. Accept terms, digitally sign using Aadhaar OTP

📌 Takes: 10–15 minutes
📅 Approval: Usually done within 24 hours

💰 Step 3: Add Funds to Your Account

After approval, transfer money into your commodity wallet (can be done via UPI/Net Banking).

Minimum amount?
Start with ₹1,000–₹5,000 — depending on the margin required for your trade.

💡 Start small. Test your strategies. Avoid putting all your money on Day 1.

🛒 Step 4: Place Your First Commodity Trade

Say you want to trade Crude Oil Futures on MCX:

1. Go to MCX Crude Oil contract (e.g., CRUDEOIL24AUGFUT)

2. Select “Buy” or “Sell”

3. Enter quantity (typically multiples of 100 barrels)

4. Set:

   • Limit or Market Price

   • Stop-loss

   • Target profit (optional)

5. Confirm trade

💼 Done! You’re officially a commodity trader.

🔄 Step 5: Monitor and Exit Your Trade

Use charts and alerts to monitor your trade. You can:

• Exit manually before expiry (most common)

• Let it expire (auto squared-off by broker)

• Roll it forward to next month (advanced)

 

📦 Step 6: Withdraw Profits (or Add More Funds)

Go to your broker’s fund section and:

• Withdraw profits to your linked bank account

• Or add more capital for new trades

💡 Note: Profits are settled in T+1 day for commodities.

🎓 Real-Life Example:

Anjali, a 21-year-old student, bought 1 lot of Silver Mini Futures with ₹5,500 margin. She used a limit buy at ₹75,000, held for 2 days, and exited at ₹75,900 — making ₹900 profit after brokerage.

✅ Pro Tips for First-Time Traders

• Trade only in liquid commodities (like Gold, Silver, Crude Oil)

• Use stop-loss in every trade

• Don’t trade during high-volatility news (e.g. Fed rate announcements)

• Start with mini contracts (less risky)

📊 Step 7: Learn the Platform Basics

Familiarize yourself with:

• Watchlists (e.g. Gold, Crude Oil, Natural Gas)

• Market Depth (bid/ask price levels)

• Candlestick charts

• Order types:

  • Market Order (instant trade at current price)

  • Limit Order (your price, wait for execution)

• Stop-loss & target (risk management)

 

Before placing your first trade, learn:

• How contracts work (expiry, lot size)

• What affects commodity prices (e.g. OPEC news, inflation, monsoon)

• How to read price charts

• What is stop loss and target

✅ Use free mock trading apps or watch live markets for a few weeks.

Place Your First Trade (Practice Lot)

Start small — use 1 mini lot of crude or natural gas.

What to do:

• Pick a direction (Buy/Sell)

• Add Stop-Loss & Target

• Monitor your trade

• Exit manually or let SL/target hit

Start by trading only during active hours (like 6 PM to 11 PM for energy contracts).

🔍 Step 8: Track, Learn, and Improve

Keep a trading journal:

This helps you spot patterns in your mistakes and improve.

🧘‍♂️ Bonus: Follow the 10 Golden Rules for Beginners

1. Trade only with risk capital

2. Avoid tips groups or paid calls

3. Never average a losing position

4. Learn technical & basic fundamentals

5. Don’t trade during uncertain news

6. Use trailing stop-loss to protect profits

7. Track global commodity news

8. Stay away from high leverage at the start

9. Book profits — don’t get greedy

10. Respect the market, always

 

📊 Advanced Strategies in Commodity Trading

Once you’re comfortable with the basics and have placed a few practice trades, you can level up by learning and applying more advanced strategies. These will help you reduce risk, increase profits, and trade like a professional.

🔎 1. Technical Analysis for Commodity Trading

Technical analysis means predicting price movements using charts, patterns, and indicators — instead of news.

📉 Key Chart Types:

• Line Chart: Simple closing price view

• Bar Chart: Shows open-high-low-close

• Candlestick Chart: Most used — shows emotion behind price

🔧 Common Indicators:

🧠 Pro Tip: Combine 2–3 indicators, not 10. Simpler charts give clearer signals.

2. Fundamental Factors That Move Commodities

Understanding why prices move gives you a big edge.

📈 Gold Prices Move Due To:

• Global inflation fears

• USD strength/weakness

• Interest rates (esp. US Fed)

• Central bank buying

🛢 Crude Oil Moves Due To:

• OPEC decisions

• U.S. inventory data (Wednesdays)

• Geopolitical tension (Middle East, Russia)

• Demand/supply shocks

🌾 Agri Commodities:

• Monsoon forecast

• MSP announcements

• Global crop yield reports

• Seasonal demand (festivals, export bans)

✅ Bookmark websites like: Investing.com, TradingEconomics.com, and MCX India

🧩 3. Hedging vs. Speculation

Even individual traders can use hedging strategies to offset losses (e.g., short crude oil if your portfolio is exposed to inflation-sensitive assets).

 

🔑 Key Takeaway

Trading commodities is as easy as trading stocks today. Choose a trusted broker, learn platform basics, and always trade with discipline.

4. Scalping vs Swing Trading vs Positional

✅ Beginners should start with swing trading — it’s balanced and less stressful.

📚 5. Popular Commodity Trading Strategies

🎯 Breakout Strategy

• Buy when price breaks above resistance with volume

• Works well in trending markets

📉 Pullback Strategy

• Wait for a small dip after an uptrend

• Enter near support + moving average

🔁 Mean Reversion

• Prices return to average after extreme move

• Used with Bollinger Bands or RSI

🧠 Tip: Always backtest your strategy before using real money.

🧠 6. Psychology of Trading

Most traders fail not because of bad strategy, but:

• Overtrading

• Revenge trading

• Fear of missing out (FOMO)

• Not sticking to the plan

📌 Golden Rule: Emotionless execution is more powerful than perfect analysis.

 

 

🥇 Top Commodities Traded in India (With Examples & Use Cases)

Commodity trading in India spans multiple categories — from precious metals like gold to energy resources like crude oil and even agriculture products like wheat. Let’s explore them clearly, with real-world relevance.

🧱 1. Precious Metals

These are the most popular commodities for Indian traders.

💡 Gold contracts come in different sizes: Gold, Gold Mini, Gold Guinea – each with different margin requirements.

⚡ 2. Energy Commodities

High volatility, high reward. Best for slightly experienced traders.

🧠 Fact: Global events like OPEC meetings or wars affect oil prices dramatically.

🌾 3. Agricultural Commodities (Agri-Products)

These trade on NCDEX, not MCX.

📉 Agri futures often follow seasonal cycles (harvest/sowing months). This can help in trend prediction.

🧪 4. Industrial Metals

These are lesser known but used for economic prediction.

 

📊 Quick Summary Table

 

💡 Which One Should You Trade?

 

🚫 Commodities You Shouldn’t Trade as a Beginner

• Low-liquidity ones (e.g. Kapas, Mentha Oil)

• Exotic global contracts without experience

• High-margin ones if you’re undercapitalized

 

💰 Margins, Leverage & Risk in Commodity Trading – Explained Simply

Understanding margins, leverage, and risk is crucial in commodity trading. Many new traders jump in for profits and get wiped out due to poor risk management. Let’s break it down clearly.

🧾 What is Margin in Commodity Trading?

Margin is the minimum amount you need to deposit to open a trade. You don’t pay the full value of the contract — just a percentage.

📌 Example:

• Gold Futures Contract Value = ₹50 Lakhs

• Required Margin (Say 5%) = ₹2.5 Lakhs

👉 You control ₹50 Lakhs worth of gold with just ₹2.5 Lakhs.

This is possible due to leverage.

🔁 What is Leverage in Commodity Trading?

Leverage is like a loan your broker gives you to trade big with small capital.

✅ More leverage = higher potential profit… AND higher risk.

📉 How Risk Works (And Why Beginners Lose Money)

Imagine you bought crude oil at ₹7000 per barrel with 10x leverage.

• If price rises to ₹7100 (+₹100), you gain ₹100 × lot size

• If price drops to ₹6900 (-₹100), you lose ₹100 × lot size

But since you’re leveraged, that 1.4% drop could wipe out 14% of your capital!

⚖️ Risk Management Rules for Beginners

 

🔐 Types of Margins You’ll See on MCX

You’ll need enough free margin to keep positions open. If not, your trade gets auto-squared off.

📊 Realistic Example: Trading 1 Lot of Crude Oil

A 3% move against you = ₹21,000 loss on ₹70,000 — a 30% capital loss!

🚨 Warning: High Leverage = High Danger

Many new traders treat leverage like a magic profit button. It’s not. It’s a double-edged sword.

Even experienced traders get wiped out by:

• Sudden commodity bans

• Exchange halts

• Overnight price gaps

Position Sizing & Risk Management

Never risk more than 2% of your capital in one trade.

Formula to calculate lot size:

Risk per trade = (Entry – Stop Loss) × Lot Size
Lot Size = Risk Amount ÷ (Entry – Stop Loss)

Example:

• ₹1,00,000 capital

• Willing to risk ₹2,000

• Crude oil entry = ₹7100, SL = ₹7050

• ₹2,000 ÷ (7100–7050) = 40 lots

📌 Adjust lot size based on volatility.

📜 Legal Framework, Taxation & Regulations for Commodity Traders in India

Commodity trading in India is regulated and structured, which helps protect traders and maintain market integrity. Here’s what you must know before starting.

🏛️ 1. Who Regulates Commodity Markets in India?

Since 2015, the Securities and Exchange Board of India (SEBI) is the primary regulator for all commodity derivative trading.

Previously, it was regulated by the Forward Markets Commission (FMC), but FMC merged with SEBI for better oversight.

🧾 SEBI’s Role Includes:

• Regulating exchanges like MCX, NCDEX

• Preventing price manipulation

• Ensuring fair practices

• Approving new contracts

• Protecting investor interests

 

🏟️ 2. Recognized Commodity Exchanges in India

✅ Most retail traders use MCX, especially for gold, silver, and crude oil.

💼 3. Legal Requirements to Trade

You must open a commodity trading account with a SEBI-registered broker. Most major stock brokers (Dhan, Upstox) offer both equity and commodity segments.

📋 Documents Required:

• PAN card

• Aadhaar card

• Bank proof

• Income proof (for derivatives)

• Signature and photo

🧠 Note: KYC is mandatory.

💵 4. Taxation Rules for Commodity Trading in India

Commodity trading is treated like trading in derivatives (futures & options). Here’s the breakdown:

🧾 Income Head: Business Income

• Must be reported under Income from Business & Profession

• Taxed as per your income slab

• Can claim expenses like brokerage, internet, etc.

📉 Losses:

• Speculative losses (like intraday commodity trades) can be carried forward for 4 years

• Non-speculative losses (e.g. futures) can be carried forward for 8 years

• Losses can be adjusted only against similar income types

📅 Audit Requirement:

• If turnover exceeds ₹1 crore (or ₹10 lakh if losses and no other income), a tax audit may be needed under Section 44AB

📚 Form to Use: ITR-3

⚠️ Tip: Consult a tax advisor — incorrect filings may trigger scrutiny.

📑 5. Other Legal Considerations

❗ 1. Commodities banned for trading

SEBI sometimes bans certain agri commodities for a period to control inflation.

⚖️ 2. No insider trading, rigging allowed

SEBI has strict rules against price manipulation and uses surveillance tools.

🔐 3. Margin Requirements are regulated

Brokers must follow minimum margin rules set by SEBI/Exchanges to prevent excessive risk.

✅ Summary

 

⚠️ Common Mistakes in Commodity Trading & Real-Life Examples

Many beginners (and even experienced traders) lose money not because the market is unfair, but due to avoidable mistakes. Let’s look at the most common ones and real-world scenarios to learn from.

🧠 1. Lack of Research

❌ Mistake:

Jumping into gold or crude oil futures just because a YouTube influencer said “It’s going to boom tomorrow!”

✅ Solution:

Always use technical + fundamental analysis and follow global cues. For example, crude oil prices often react to OPEC announcements, US inventory data, or geopolitical tensions.

📘 Real Example:

In 2022, many traders went long on crude oil after Russia invaded Ukraine. But prices dropped sharply after peace talks — wiping out overleveraged traders.

🕰️ 2. Overtrading or Trading All the Time

❌ Mistake:

Trying to catch every price movement leads to fatigue, poor decisions, and brokerage loss.

✅ Solution:

Trade only when there is a confirmed setup. Quality > Quantity.

💡 Tip: Avoid “revenge trading” after a loss.

💰 3. Ignoring Margins and Leverage Risk

❌ Mistake:

Using high leverage thinking, “I’ll double my money in 1 day!”
That works… until it doesn’t.

✅ Solution:

Use only small portion of your capital per trade. Don’t ignore margin calls. Always have a stop-loss.

📘 Real Example:

A trader invested ₹10,000 in silver futures with 10x leverage. One 5% dip led to complete capital wipeout because they didn’t use a stop-loss.

📅 4. Not Understanding Expiry & Settlement

❌ Mistake:

Holding a commodity contract till expiry, not realizing it requires physical delivery in some cases.

✅ Solution:

If you don’t want delivery, square off your position before expiry. Know the last trading day for each commodity.

📊 5. No Trading Journal or Plan

❌ Mistake:

Taking random trades without recording why you entered or exited.

✅ Solution:

Maintain a trading journal with:

• Entry & exit price

• Reason for trade

• Mistakes made

• Profit/loss

This improves discipline and strategy over time.

📉 6. Ignoring Global Events & Data Releases

❌ Mistake:

Trading crude oil without knowing when EIA inventory report comes out every Wednesday.

✅ Solution:

Track:

• US Fed meetings

• China GDP (they’re major commodity consumers)

• Monsoon forecast (for agri trades)

• Global inflation & war news

🌍 Commodities are global. Don’t trade with local vision.

7. Treating Commodity Trading like a Lottery

❌ Mistake:

Expecting to turn ₹5,000 into ₹5 lakh in a month.

✅ Solution:

Commodity trading is not gambling. It’s a business. Success takes:

• Strategy

• Risk management

• Patience

 

🤦 8. Blindly Following Tips or Telegram Groups

❌ Mistake:

Acting on random WhatsApp tips without cross-verifying.

✅ Solution:

Trust only reliable research or do your own. Many scammers run fake “premium groups”.

🚨 Summary Table

 

💡 Pro Tips for Commodity Trading Beginners to Grow Consistently

To truly thrive in commodity trading, you don’t just need knowledge — you need discipline, habits, and smart tactics. Below are time-tested tips that can help beginners gradually become confident and profitable traders.

📘 1. Master One Commodity First

Don’t try to trade everything from gold to guarseed from day one.

Start with one — preferably Gold, Silver, or Crude Oil, since they:

• Have good liquidity

• Are easy to analyze due to ample global news

• Offer tight spreads (less cost per trade)

Once you master the movement, indicators, and fundamentals of one commodity, you’ll find it easier to expand.

🧠 2. Learn Price Behavior, Not Just Indicators

Indicators lag. Price action tells the truth.

Spend time reading candlestick charts, support/resistance zones, and volume spikes. Understand why a price moves — not just that it moved.

Example:
When crude oil hits ₹7,000 and volume rises, is it:

• A breakout?

• A bull trap?

• A news-based pump?

Don’t just react — interpret.

📉 3. Always Use a Stop-Loss (SL)

SL is your seatbelt in the trading highway.

Never enter a trade without knowing:

• Where you will exit if you’re wrong (SL)

• Where you will exit if you’re right (target)

Even professional traders have a 50–60% accuracy rate — risk management is how they stay profitable.

🔍 4. Follow Economic Calendar Weekly

Track major global events affecting commodities:

• Crude Oil: US inventory reports (EIA), OPEC meetings

• Gold: US Dollar index, interest rate changes

• Agri: Indian monsoon, crop reports, MSP changes

Use sites like:

• MCXIndia.com

 

📱 5. Use a Trusted Trading App or Platform

Pick a broker that offers:

• Fast execution

• Low brokerage

• Good charting tools (like TradingView)

• Margin calculator

• Education material or paper trading

Some beginner-friendly brokers in India:

• Dhan – Best Overall Broker for Commodity Trading in 2025

• Why it’s #1: Zero-cost tools, deeply integrated with TradingView, free APIs, and modern UI make Dhan the top choice.

• Strengths:

  • Dedicated commodity-focused trading tools

  • Fast order execution

  • Live market scanners and strategy builder

  • Free access to advanced charts

  • Also gives Margin Trading Facility (MTF)

 

• Ideal For: Both beginner and pro traders looking for low brokerage with high-end tools.

• Deep TradingView Integration: Unlike others who offer limited TradingView functionality, Dhan lets you trade directly from TradingView charts, a game-changer for active traders.

• Custom Strategy Builder: Dhan offers an in-built visual strategy builder that requires no coding—perfect for creating and testing commodity strategies on-the-go.

• Split-second Order Execution: With latency optimized infrastructure, Dhan offers faster order placement, crucial for volatile commodity markets like Crude Oil or Gold.

• Live Market Scanners for MCX: Filter top movers, unusual volume, or high volatility commodities in real-time.

• Pre-built Commodity Dashboards: See price trends, open interest, and volume in one glance.

• Have different types of orders available such as Gtt, Limit order, Market order, Stop-loss order, forever, after market, basket order, super order and lot more.

 

Did You Know?

If you place just 50 commodity trades a month, switching from a ₹20-per-order broker to Dhan (0.03%) could save you ₹500–₹800/month, especially if your trade sizes are small.

Feature for Commodity Traders

Dhan offers specific features that matter to commodity traders:

• Margin details shown upfront

• Real-time commodity news feed

• Custom alerts for commodity price levels

• Night mode optimized for after-market MCX traders

• Auto-Detection of Candlestick Patterns on Charts on their trading platform which means charts should automatically recognize & display the names of widely known Candlestick Patterns.
• Other features like 20 Depth Data, Price Alerts, Import Watchlists, etc. you have enough data to help you with your trades.

 

Dhan mobile App have been downloaded on playstore by more than 1.5 million people with a user rating of 4.5 which also shows the trust they have created among users within small time period.

If you’re serious about commodity trading in 2025, Dhan gives you the edge with powerful tools, zero hidden costs, and blazing-fast execution. Don’t just trade—trade smart with Dhan.

Open Your Free Dhan Account Now with no AMC charges

Steps top open an account:

1. Submit PAN, Aadhaar, Bank proof

2. Enable Commodity (Derivatives) in account settings

3. Add funds and get started

Click Here to Open Your Free Dhan Account
No paperwork. No account opening charges. Get started in 5 minutes! Dhan also offers advanced tools like TradingView & Options Trader built-in.

 

📝 6. Keep a Trading Journal

Track every trade with:

• Entry/Exit price

• Why you entered

• What worked/what didn’t

• Lessons learned

This is your personal trading autopsy report. Over months, it will reveal patterns in your success/failures.

📊 7. Build a Risk Plan

Don’t risk your entire capital on one trade.

Use the 1% Rule:
Risk only 1–2% of your capital per trade. If you have ₹50,000, your loss per trade should not exceed ₹500–₹1,000.

That way, you stay in the game even with multiple losses.

🧪 8. Paper Trade Before You Go Live

Don’t jump in with real money. Simulate.

Do mock trading. Use it to:

• Test strategies

• Understand contract behavior

• Build confidence

 

🧘 9. Control Emotions

The biggest enemy of a trader is:

• Fear of losing

• Greed to win more

• FOMO (Fear of Missing Out)

Follow a plan. Detach emotionally. Avoid trading when angry, tired, or bored.

🧩 Bonus Tip: Treat Trading Like a Business, Not a Side Hustle

Track your:

• Capital invested

• Brokerage & taxes paid

• Monthly profits/losses

This mindset shift helps improve discipline and seriousness.

✅ Conclusion: Your Journey into Commodity Trading Begins Now

Commodity trading in India is no longer reserved for experts or institutional players. With access to online platforms, educational tools, and transparent exchanges like MCX, any individual — even a complete beginner — can start trading commodities smartly and safely.

Whether you’re fascinated by the movement of gold, crude oil, or agri-products, or you’re looking to diversify beyond stocks and mutual funds, commodities offer a dynamic, exciting, and potentially profitable avenue.

But remember — success doesn’t come from luck or tips, it comes from:

• Learning the basics

• Practicing consistently

• Managing risks wisely

• Keeping emotions in check

If you treat trading like a skill, and not a gamble, it can become a rewarding long-term pursuit.

So take that first step — open a account, track real markets, and slowly move towards real trading.
Your first profitable trade might be just a few sessions away.

In 2025, the landscape of commodity trading in India is more dynamic than ever, with brokers racing to provide better tools, lower costs, and seamless platforms. Among them, Dhan emerges as the best broker for commodity trading, thanks to its low-cost model, advanced tech integrations, and superior user experience.

If you’re a trader or want more control over execution, charts, and speed.
Dhan is not just another discount broker — it’s genuinely innovating, especially for the next-gen Indian trader.

If you’re tired of clunky trading platforms and want modern, high-speed trading with transparent fees — Dhan is one of the best stockbrokers in India today.

According to the latest NSE reports  there are about 200+ stock brokers in India, however what makes Dhan a leading and strong contender in the stock broking industry is the tools and resources they have in their trading platform.

Moreover there are no hidden charges and the brokerages are very minimal if we do the industry comparison. They are also backed by cash enriched investors so nothing to fear.

here’s never been a better time to take control of your financial future and with Dhan, you get the fastest, most reliable, and feature-packed stock broker app in India for 2025.

Whether you’re a beginner eager to start investing or an experienced trader seeking advanced tools and zero brokerage on delivery trades, Dhan has everything you need to succeed.

Don’t settle for less. Join over 1 million satisfied users who trust Dhan to power their trading journey every day. With zero account opening fees, free access to multiple platforms, and dedicated customer support, the path to smarter trading has never been easier.

🚀 Ready to Elevate Your Trading Game?
Start your journey with Dhan — India’s fastest, most reliable, and user-friendly stock broker app trusted by over 1 million users.

No hidden fees. No complicated processes. Just smart, seamless trading.

Open My Free Dhan Account Now

It takes less than 5 minutes to sign up and start trading.

 

If, you have liked the content please do share it with your friends or on social media, as sharing do bring the good karma. If you have any questions or feedback you can leave them in comment box below.

🌟 4 Best Brokers for Trading in India (2025) – Dhan vs Upstox vs Zerodha vs Fyers

🏆 Best Demat & Trading Account in India (2025) – Dhan vs Upstox vs Zerodha vs Groww

 

Here is the list of things as a beginner you should know, if you are thinking for doing intraday trading.

A brief understanding of

How share market works?

How To Invest In Indian Stock Market – Explained With Examples For Beginners

Learn about the basics of candlestick chart patterns and how to use them for intraday trading and investing. You should also learn about the best moving averages to use for better trading result.

Checkout Mastering Intraday Trading: A Beginner’s Guide to Profitable Strategies in the Indian Stock Market

Note: Please do your own research and make investment. Moneycontain will not be responsible for any of your losses at all. The point made is for educational purpose only and intended to give information. All investments are subject to risks, which should be considered prior to making any investments.

 

⚠️ Disclaimer

This article is for educational purposes only. Commodity trading involves financial risk and may not be suitable for every individual. Please do your own due diligence, consult with a SEBI-registered financial advisor or certified professional before making any investment or trading decisions. The author and publisher are not liable for any losses incurred based on the information provided in this article.