Day Trading Commodities: CFD Guide

Day trading commodities through CFDs is not the same as forex. Gold and oil move on headlines, inventory reports, and rate expectations, not just currency differentials.

Generic FX strategies often fail on these instruments because the drivers are fundamentally different.

This guide gives you a repeatable daily checklist for XAU/USD and UKOIL (Brent): what to watch before the open, when volatility hits, and how to structure entries and exits.

What Is Day Trading Commodities?

Day trading commodities is buying and selling commodity CFDs like gold, oil, or natural gas within the same trading day to profit from short-term price movements.

Commodity day trading follows the same intraday timeframe as forex day trading: positions are opened and closed within hours or minutes, never held overnight.

The core difference is the instrument: commodity CFDs replace currency pairs.

Examples include XAU/USD (gold) and UKOIL (Brent crude oil), both priced against the US dollar.

Commodities respond to different drivers than forex markets. Inventory reports (the EIA weekly petroleum status), supply disruptions (geopolitical events affecting oil production), and physical demand factors create volatility patterns unique to commodity markets.

A forex trader analyzing central bank policy will encounter different price dynamics than a commodity trader reacting to an OPEC production cut or a natural gas storage report.

CFDs offer five structural advantages for commodity day trading:

• No physical ownership or expiry dates: CFDs track commodity price movements without requiring physical storage or rollover of futures contracts.

• Leverage amplifies small price moves: Margin requirements allow traders to control larger positions with smaller capital, though this magnifies both gains and losses.

• Bidirectional trading: Traders can open long positions anticipating price rises or short positions expecting declines, providing flexibility in any market condition.

• Lower capital requirements than futures: Standard commodity futures contracts often require substantial margin deposits. CFDs typically offer smaller contract sizes and lower entry thresholds.

• Multi-commodity access from one account: A single CFD brokerage account can provide access to gold, oil, natural gas, silver, and other commodities without separate exchange memberships.

How Commodity CFDs Work

Commodity CFDs are derivative contracts that let you trade price movements of commodities like gold and oil without owning the physical asset, using leverage and margin.

CFDs use margin to provide leveraged exposure. A trader deposits a fraction of the full position value (the margin requirement) while gaining exposure to price movements on the entire notional amount.

Profits and losses are calculated on the full position size, not the margin deposited. A gold CFD with 5% margin allows a trader to open a $10,000 position by depositing $500. If gold moves 2% in the trader's favor, the gain is $200 (2% of $10,000), representing a 40% return on the $500 margin. The same 2% adverse move produces a $200 loss: 40% of the deposited margin.

Three specifications define the economics of commodity CFD positions:

Contract size: The amount of the underlying commodity one CFD lot represents. One standard lot of gold CFD typically equals 100 troy ounces of gold. Smaller micro-lots (10 oz) or mini-lots (10 oz) may be available depending on the broker.

Tick value: The monetary value of the smallest price increment. For gold priced in dollars per ounce with a contract size of 100 oz, a $0.01 price move (one tick) equals $1 in profit or loss per lot.

Spread: The difference between the bid price (sell) and ask price (buy). The spread represents the immediate cost of entering a trade. During the London-New York overlap, many brokers show XAU/USD spreads in the range of 10–30 points versus 30–80+ points during quieter periods. Verify in your broker's MT5 'Market Watch' spread column.

Specs vary by broker. Verify contract details in MT5 under the instrument's 'Specification' tab before trading.

What Moves Commodity Prices Intraday? (Daily Drivers Checklist)

Commodity prices move intraday based on macro events (CPI, NFP, central bank decisions), US dollar and yield shifts, energy supply headlines, and broad risk sentiment across correlated markets.

Scheduled economic releases and supply reports create predictable volatility windows. Non-Farm Payrolls, CPI data, and oil inventory reports routinely trigger short-term price spikes in commodities like gold and crude oil.

Mini example (Gold on CPI): If CPI prints 0.3% vs 0.2% expected, XAU/USD can whipsaw for 1–5 minutes. One practical approach: wait for the first 5-minute candle to close, mark its high and low, then only trade a break of that range with a stop on the opposite side. Risk fixed to 0.5–1.0R per trade.

Key commodity-specific reports and benchmarks to track beyond the economic calendar:

• US 10Y real yields (proxied via TIPS) and Fed Funds Futures for rate expectations

• COMEX gold futures volume/open interest for liquidity context

• Baker Hughes Rig Count (Fridays) as an oil supply signal

• CFTC Commitments of Traders (weekly) for positioning backdrop

• EIA Short-Term Energy Outlook (STEO) for the broader supply/demand narrative

A daily drivers checklist prevents reactive trading. When you review the economic calendar each morning, you can plan entries before announcements hit. This includes entering trades during peak overlap hours when US and European markets trade simultaneously, rather than chasing price movements after the fact.

Macro events and rate expectations (CPI, NFP, central banks)

CPI, NFP, and central bank announcements move commodities by shifting inflation expectations, altering the interest rate outlook that drives gold and oil demand.

Non-Farm Payrolls (NFP): US employment data causes immediate volatility in gold and oil as markets reprice growth and interest-rate expectations.

Consumer Price Index (CPI): Inflation reports directly impact gold by shifting real yields and the US dollar simultaneously.

Federal Reserve announcements: FOMC statements and rate decisions move commodity markets by shifting the interest-rate outlook and expectations for dollar strength.

GDP releases: Quarterly growth data influences oil demand forecasts and industrial metal prices.

Traders review an economic calendar before each session to identify high-impact releases. NFP and CPI announcements often produce sharp intraday moves.

Positions are commonly reduced ahead of scheduled releases, or entries are delayed until initial volatility subsides.

US dollar and yields (why gold and oil often react)

Gold and oil are priced in USD, so a stronger dollar makes them more expensive globally, reducing demand; rising yields increase the opportunity cost of holding non-yielding gold.

The DXY (Dollar Index) often precedes or confirms gold reversals during US trading hours. When the dollar strengthens, gold faces downward pressure since it is priced in USD. Interest rate changes affect commodity financing costs in two ways: (1) a stronger dollar from rate hikes applies direct pricing pressure, and (2) higher rates increase the cost of holding leveraged positions, dampening speculative demand across gold, oil, and other commodities.

What matters for gold isn't nominal yields but real yields: the interest rate after inflation. Because gold pays no interest, rising real yields make bonds more attractive by comparison. When 10-year real yields climb from 1% to 2%, bond investors collect meaningful carry while gold holders earn zero, prompting capital rotation out of XAU/USD.

The nuance matters for day traders: gold can rally even when nominal yields rise, provided inflation expectations rise faster. In that scenario, real yields compress or turn negative, restoring gold's appeal as an inflation hedge despite higher headline rates.

Energy supply headlines and inventory reports (EIA/API, OPEC, geopolitics)

Energy prices react to weekly inventory reports (EIA Wednesday, API Tuesday), OPEC production decisions, and geopolitical supply disruptions in major producing regions.

API: Tuesday, 4:30 PM ET

EIA: Wednesday, 10:30 AM ET

Both reports track US crude oil inventories. Oil inventory reports inject significant volatility into WTI prices around release times.

The EIA release is the official government number, so traders often treat it as the more definitive data point. API is a private estimate published the evening before.

OPEC+ typically meets monthly or quarterly to review production quotas for member countries.

Supply or demand news drives oil trades. Unexpected OPEC+ headlines can reprice crude quickly. Moves of $2–$5 per barrel intraday are common during volatile regimes. Even rumors of a quota change before the official meeting can move markets.

Political events affecting exports and imports trigger immediate price reactions in WTI and Brent:

Middle East tensions: Conflicts in major oil-producing regions push crude prices higher.

Russian supply disruptions: Sanctions or pipeline issues reduce global supply availability.

Shipping lane closures: Blockages at the Strait of Hormuz or Red Sea create supply fears and trigger instant price spikes.

Risk sentiment and correlated markets (equities, bonds)

Commodities often move with risk sentiment: gold rises as a safe haven when equities sell off, while oil tends to fall when recession fears spike and bond yields drop.

When equity markets sell off sharply, capital flows into XAU/USD as a safe haven, often spiking within the same trading session. Investors treat gold as a store of value during periods of uncertainty, viewing it as protection against portfolio losses.

This inverse relationship between stocks and gold creates short-term trading opportunities when risk sentiment deteriorates. Gold traders watch equity index futures closely. A sudden drop in the S&P 500 can trigger a XAU/USD rally quickly.

A weak economy broadly lowers demand for commodities involved in building and transport, but gold moves counter to that trend. Capital seeks defensive assets rather than growth-linked ones, pushing gold higher even as industrial metals fall.

Risk-off scenarios hit oil demand expectations first. Because crude is demand-driven, recession fears push traders to price in reduced future consumption. When S&P 500 futures drop on weak data, WTI and Brent typically follow lower.

Conversely, strong growth supports crude. A booming economy lifts oil demand expectations, pushing prices higher as markets anticipate increased consumption across transport and manufacturing. Day traders monitor equity index futures as a leading indicator for oil directional moves, especially around macro releases that shift economic outlooks.

Best Commodities for Day Trading

Gold (XAU/USD)

Gold (XAU/USD) is the most liquid precious metal CFD, with tight spreads and volatility driven by USD moves, rate expectations, and risk sentiment.

The London-New York overlap (13:00–17:00 UTC) produces the highest XAU/USD volume and tightest spreads. Liquidity peaks as both major financial centres trade concurrently.

US economic releases often trigger significant intraday moves:

• CPI reports

• Non-farm payrolls

• Federal Reserve decisions

These events serve as primary volatility catalysts for gold day traders.

Standard lot: 100 oz. Tick value: $0.01/oz = $1/lot/tick. Micro lots: 0.01 lots available for smaller position sizing.

Margin requirements vary by broker. Contract specifications should be verified on the chosen platform before opening positions.

Gold and silver are safe-haven assets that typically hold value during volatile or uncertain economic conditions. Gold often rises when equities sell off sharply.

Equity index movements provide correlation signals. Price action in major stock indices can indicate potential directional shifts in gold during risk-off periods.

Crude Oil (WTI and Brent)

Crude oil CFDs (WTI and Brent) offer high volatility from inventory reports, OPEC decisions, and geopolitical headlines. That makes them ideal for news-driven day trades.

WTI (West Texas Intermediate): US crude priced in Cushing, Oklahoma.

Brent Crude (UKOIL): North Sea blend serving as the global benchmark. Typically trades at a premium to WTI due to international demand.

Both benchmarks are widely traded in global energy markets. With VantoTrade, you can trade Brent crude (UKOIL) alongside XAU/USD on one MT5 account, so you don't need to switch platforms between metals and energy.

EIA inventory report: The EIA Weekly Petroleum Status Report publishes Wednesdays at 10:30 AM ET (convert to UTC seasonally). Supply data routinely causes sharp price moves as traders react to inventory changes.

API inventory data: Released Tuesday evenings, giving early direction before the official EIA report.

OPEC+ meetings: Production decisions can trigger large moves as the cartel adjusts global supply.

Geopolitical headlines:

• Middle East conflicts

• International sanctions

• Shipping disruptions in key oil routes

Standard lot: 1,000 barrels

Tick value: $0.01/barrel = $10/lot/tick

Mini/micro lots: Available at most brokers for tighter risk control on volatile oil moves.

Natural Gas

Natural gas is a highly volatile energy CFD driven by seasonal demand cycles and weekly inventory data, offering aggressive intraday swings but requiring strict risk management.

For natural gas, volatility comes from two forces: seasonality and storage surprises. Winter heating demand pushes prices higher while summer consumption drops them lower (Corporate Finance Institute). Then every Thursday at 10:30 AM ET, the EIA Natural Gas Storage Report hits -and inventory surprises can trigger sharp intraday moves as traders adjust positions to new supply data.

Natural gas routinely moves 3-5% in a single session compared to 1-2% typical daily ranges in gold and oil. This higher volatility requires tighter position sizing.

Key risk differences versus gold and oil:

Wider spreads: Natural gas CFDs typically carry larger bid-ask spreads than gold contracts.

Higher margin requirements: Brokers require more collateral per contract due to the larger percentage swings.

Larger tick value: Each price increment represents more dollar risk per position than in gold or oil trades.

Because natural gas swings harder than gold or crude, it rewards traders who already manage energy positions comfortably. You'll need to watch EIA inventory reports (released Thursdays at 10:30 AM ET) and weather forecasts closely, since supply shocks and demand spikes move prices fast.

If you're new to commodities, start with our beginner's guide and focus on gold or oil. Natural gas requires tighter stop-losses and smaller position sizes to keep risk consistent across your portfolio.

VantoTrade offers natural gas CFDs alongside gold, silver, and oil with transparent spreads and flexible leverage. Most traders size NG positions at 30-50% of their typical crude oil allocation to account for higher volatility.

How to Day Trade Commodity CFDs

Day trading commodity CFDs involves four core steps: selecting a CFD broker with competitive spreads, understanding active market hours and session overlaps, building repeatable entry rules, and managing exits. It starts with broker and platform selection.

• A CFD trading account with a broker offering commodity instruments (gold, oil, natural gas) on MT5

• Understanding of leverage mechanics and margin requirements

• Sufficient starting capital to manage position sizes and withstand intraday volatility

• Platform access with real-time charting and execution tools

With 100:1 leverage, a $10,000 position requires $100 in margin, but losses are also amplified by the same ratio.

Account verification time varies by jurisdiction and document checks. In many cases, approval can be completed within the same day.

Learning market hours, session overlaps, and basic chart setups can be done in a single session. Executing consistently and developing a reliable trading process takes longer.

Choose a CFD Broker and Platform

Choose a CFD broker with tight commodity spreads and regulation, so you get fills that match your entry plan during fast gold and oil moves.

Real-time data and low latency: Commodity markets require real-time information and charting tools with minimal execution delay.

Platform and pricing: VantoTrade offers MT5 with competitive pricing and fast execution for commodity CFDs. Spreads, leverage limits, and minimum deposits depend on the account type and jurisdiction. Check VantoTrade's product specs for current figures.

Broker due-diligence checklist (5 minutes):

1. Confirm the broker's regulation and license number on the regulator's public register

2. In MT5, open the instrument 'Specification' and check contract size, tick size, and swap rates

3. Record average spread on XAU/USD and UKOIL during your trading window (e.g., 13:00–17:00 UTC) for 3 days

4. Place a demo market order during a news spike and note any slippage

5. Verify margin close-out and stop-out levels in your account terms

Common mistake: choosing the lowest advertised spread but ignoring slippage and stop-out rules during volatile sessions.

• One-click trading, real-time charts, and technical indicators for fast intraday execution

• Order types (market, limit, stop) accessible without navigating multiple menus

• Mobile access for monitoring positions away from the desk

• Charting tools integrated directly into the execution platform

Tight spreads on gold and oil CFDs matter more for day traders taking multiple positions daily. A 2-pip difference in XAU/USD spread increases transaction costs noticeably across five or six trades.

Comparing spread costs across brokers for XAU/USD and UKOIL before committing reveals differences in total transaction costs.

Learn Market Hours and Session Overlaps

Most commodity CFDs quote prices nearly 23 hours per day from Monday to Friday, with a brief daily maintenance break set by the broker or liquidity provider. Check the instrument 'Specification' in MT5 for exact hours. Peak volatility hits during session overlaps: London-New York (13:00-17:00 GMT) for gold, and US session (14:00-20:00 GMT) for oil.

The London-New York overlap (13:00-17:00 GMT) produces the highest gold volume when both financial centers trade simultaneously. Institutional desks in London and New York execute orders during this four-hour window, creating tighter spreads and faster fills.

Oil markets react to US inventory reports released Wednesdays at 14:30 GMT and OPEC announcements typically scheduled during US hours. These events generate immediate price swings that create intraday opportunities.

The Asian session (00:00-08:00 GMT) presents three challenges:

Lower volume - Fewer participants trade commodities during this period

Wider spreads - Bid-ask spreads expand when liquidity drops

Fewer catalysts - Major economic releases and inventory reports occur during London and US sessions

Index CFDs offer extended trading hours beyond stock exchange hours, but commodity markets remain most liquid during London and New York sessions.

Understanding session overlap windows helps identify peak trading periods for each commodity.

Analyse Price Action and Set Up Trades

Day traders use technical analysis to identify entry and exit points in commodity CFD positions. Indicators and price patterns help determine trade timing and direction.

Moving averages, RSI, and Bollinger Bands - RSI values above 70 or below 30 signal potential reversals. Moving average crossovers indicate trend changes.

Support and resistance levels - Range trading identifies price zones where buying or selling pressure typically emerges. Price often bounces at these levels.

Trend identification - Higher highs and higher lows indicate uptrends for long positions. Lower highs and lower lows signal downtrends for short positions.

1. Calculate position size - Determine trade size based on risk tolerance and account balance before entering. The 1-2% guideline works this way: on a $10,000 account risking 2%, a trader stops out after a $200 loss. If the stop-loss sits 20 points away, position size becomes 10 contracts at $1 per point.

2. Choose order type - Limit orders specify exact entry prices while market orders execute immediately. Market orders fill during volatile periods but can slip from the displayed price.

3. Place stop-loss immediately - Set a stop-loss at entry time to cap potential losses. This protects against unexpected moves when monitoring multiple positions.

Worked setup (WTI range break):

• Pre-levels: Asia session high $78.40, low $77.90

• Plan: Trade only during 14:00–18:00 GMT

• Trigger: 5-minute close above $78.40

• Entry: $78.45. Stop: $78.15 (30 ticks). Target: $79.05 (60 ticks, 2R)

• Position size: If 1 tick = $10/lot and you risk $150, size = $150 ÷ (30 × $10) = 0.5 lots

Pro tip: Skip entries within 2–3 minutes of EIA/API releases unless your strategy is specifically news-driven.

Common mistake: Placing stops at round numbers (e.g., $78.00) where liquidity hunts are common. Offset by a few ticks.

Monitor Positions and Exit

Active position monitoring and clearly defined exit rules are essential for managing risk in commodity day trading. Key exit rules include: take-profit targets, stop-loss thresholds, and thesis breakdown signals.

Watch for price approaching key support or resistance levels or nearing your stop-loss and take-profit zones. These technical thresholds signal potential reversals or breakouts.

Breaking news or inventory reports like the EIA or API data can spike volatility mid-trade. If crude oil inventory numbers release while a WTI position is open, price can move sharply within minutes.

Exit scenarios fall into three categories:

• Take-profit hit: Price reaches the predefined target.

• Stop-loss triggered: The trade moves against the position beyond the acceptable risk threshold.

• Thesis breakdown: The original trade setup conditions no longer hold.

Day traders typically close all positions before market close to avoid overnight gap risk and swap fees.

A Sample Daily Routine for Commodity Day Traders

A structured daily routine reduces decision fatigue and standardizes pre-market analysis. Each phase below targets one checkpoint traders can verify and repeat.

Before markets open, complete this checklist:

• Review an economic calendar for scheduled announcements (Non-Farm Payrolls, EIA inventory reports)

• Mark support and resistance levels from overnight Asian-session price action on gold and UKOIL (Brent)

• Check VantoTrade's economic calendar to flag events that historically move your target commodities

Once that pre-market checklist is done, the next decision is when to execute. The London-New York overlap (13:00-17:00 GMT) is when big commodity transactions occur at U.S. and European market hours. This window aligns with the session-based volatility patterns covered in earlier sections.

Focus on one or two commodities rather than switching between multiple markets. Gold (XAU/USD) and Brent crude (UKOIL) are the instruments most traders select for intraday CFD trading due to their established session-based behavior.

Before the session ends:

• Exit all positions before market close

• Compare planned entries against actual fills to identify execution gaps

• Log trade data: entry/exit times, setup type, P&L, and one observation per trade for pattern recognition

Track three metrics daily to measure trading quality:

• R-multiple per trade - how many times your risk you gained or lost (e.g., +1.2R, -1R)

• Average slippage (ticks) on market orders - reveals how much execution costs eat into edge

• Win rate by session - London/NY overlap vs US-only hours to find your strongest windows

Common mistake: judging performance by dollar P&L instead of R-multiples. A $500 win risking $250 (2R) beats a $700 win risking $600 (1.2R).

How to Start Day Trading Commodity CFDs on VantoTrade (MT5)

Start with a VantoTrade demo account on MT5. Add XAU/USD and UKOIL to your watchlist.

Set session-time alerts for the overlaps you plan to trade. Enable news alerts so nothing catches you mid-position.

Follow the daily routine checklist from the previous section for a full week. If you finish without breaking your risk rules (position sizing, stop placement, max daily loss), switch to a live account.

Fund it with the $25 minimum deposit and trade the smallest lot size available. You get leverage up to 1:500, but keep sizing tight until your win rate and average R:R hold steady over multiple weeks.

Open the VantoTrade demo on MT5 today. One clean week on the checklist is your entry ticket to live trading.

Frequently Asked Questions About Day Trading Commodities

Are commodities good for day trading?

Yes, commodities suit day trading due to their volatility and liquidity. Gold, oil, and natural gas offer frequent intraday price swings and deep markets for fast execution.

Gold and oil regularly move 1-2% in a single session, providing wider ranges than most currency pairs. These daily swings create multiple entry and exit opportunities for traders targeting 20-50 pip movements in XAUUSD or 50-100 tick moves in WTI.

CFDs let you control large commodity positions with margin deposits, so a $5,000 account can trade full gold or oil contracts. Tick values differ by instrument: gold moves $1 per 0.10 lot per $0.10 change, while WTI crude moves $10 per barrel per lot. Position sizing must account for these differences to avoid outsized risk on a single trade.

The London-New York overlap from 13:00 to 17:00 GMT delivers peak volume for energy and metals. Price action becomes more responsive to technical levels during this window, and spreads tighten as liquidity improves.

Set daily and per-trade caps before you start:

• Max daily loss: Stop trading after losing 2R or 1–3% of your account in a single session

• Max risk per trade: Keep position sizing at 0.5–1.0% of capital until you're consistently profitable

Common mistake: Increasing leverage after a winning trade because it feels like 'house money.' This compounds drawdowns when high-volatility commodities reverse.

Can I trade gold and silver online for intraday trading?

Yes, you can trade gold and silver online for intraday profit using Contracts for Difference (CFDs) on platforms like MetaTrader 5.

CFDs let you speculate on gold and silver price movements without owning physical metal. XAUUSD and XAGUSD markets offer high liquidity, so day traders can enter and exit positions in seconds without slippage.

VantoTrade offers gold and silver CFDs on MetaTrader 5, with leverage up to 1:500 on retail accounts. You can open positions from 0.01 lots, keeping margin requirements low for smaller accounts.

What is the difference between trading commodity futures and commodity CFDs for day trading?

Commodity futures are standardized exchange-traded contracts with fixed expiry dates, while commodity CFDs are flexible over-the-counter derivatives allowing for smaller, customizable position sizes.

Futures contracts are standardized and large: one WTI crude contract controls 1,000 barrels, requiring substantial margin. CFDs offer mini and micro lots, so you can trade 0.1 or 0.01 of a standard contract and manage risk on accounts under $1,000.

Futures charge exchange fees and clearing fees per trade, which add up on multiple daily entries. CFD costs are built into the spread, with no separate commissions on most commodity pairs. VantoTrade's raw spreads start from 0.0 pips, reducing the per-trade cost for active day traders.

Futures traders must roll positions to the next contract month to avoid physical delivery or cash settlement. CFDs auto-roll or have no expiry, so you can hold intraday positions without tracking contract dates.

One detail worth noting even for CFD traders: the futures curve structure (contango vs backwardation) can affect your costs. Broker pricing and swap/roll adjustments on commodity CFDs often reflect futures roll costs, especially in energy. Holding positions near session end or across rollover windows can change your effective cost, so check your broker's swap schedule.