Andrew Pawielski is a Commodity Futures Broker here at Daniels Trading. In his years here, Andrew has made a name for himself as a versatile broker, one who is familiar with several different types of clients that span over a diverse array of industries. In this interview, Andrew discussed his approach to understanding the markets, as well as why diversity is a good trait for a futures broker to have.
Andrew's approach to trading
Andrew, like many futures brokers, uses a mix of fundamental and technical analysis when helping his clients understand the markets and make decisions. But in addition to his solid grounding in both forms of analysis, Andrew uses his the knowledge he gleaned from his many economics classes in college to add another dimension to his thinking on the markets, particularly in respect to his specialty – grains.
"In the grain markets, when I think of a macro view, I'm looking beyond the United States. It's also about what's going on in the rest of the world. What's going on in South America? What's going on in China? How are those economies doing? Is demand being driven? What are the governments doing? You start with a macro view, the fundamentals. Then you can start getting into the nitty gritty of the technicals," Andrew said.
He likes to start with the fundamentals because as he explained, technicals are a lagging indicator of what is happening in the markets. The fundamental and technical sides come together when Andrew looks at the fundamentals of the market, sees what could be a catalyst for price movements and then uses the charts to see what impact a certain event has on prices.
Andrew's understanding of the relationship between the grains, energy and livestock markets helps him make better decisions for his clients.Diverse by design
Even though Andrew specializes in the grains markets, he was quick to add that it's never enough for a good broker to only have a focus on one area. In the case of the grains markets, Andrew said that there is enough overlap between them and the energy and livestock markets that you need to be an expert in all of them to have the full picture of what's going on in grains.
"If you look at corn, we produce roughly 13 billion bushels per year. Five of them might go to ethanol. The other eight will go to livestock feed and exports. The ratio changes each year, but it generally shuttles between those three groups," Andrew said.
The interconnected nature of these markets means that there is very little that happens in one that doesn't affect the others in some way.
"If you're going to major in grains, you need to have a minor in energy and livestock as well," Andrew concluded.
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