Gold Trading
What you should know for a successful gold trader
Gold is one of the main traded commodities in the world. Gold trading is analyzing and speculating the price of gold online via spot prices, futures, options, shares, and exchange-traded funds (ETFs). You don’t have to take ownership of the commodity or deliver it when you trade CFDs.
Online Gold Trading offers high liquidity and excellent opportunities for tacking profit with minimum investment. But market participants often fail to take full advantage of gold price fluctuations because they haven’t learned the unique characteristics of world gold markets or the hidden pitfalls that can rob profits.
Factors that Influence the Gold Price
As a gold trader, you must have knowledge of those factors that influence the price of gold. Most successful gold traders first analyze these factors then trade on gold.
• Supply and Demand
• Inflation and deflation
• Greed and fear
• Political condition of Major Countries
A combination of these factors always plays an important role in the price movement of the gold market.
Technical Analysis of Gold Price
Technical analysis is the study of historical price movement in order to identify the past patterns and predictions of future movement in the market. Before investing in gold, take time to learn the gold chart. If you learn how to trade the gold just by looking at the chart, then your probability of tacking profit will increase. The most skilled and successful Gold traders look at the history of charts and predict the future movement of gold price.
Decide your Entry and exit points.
One of the most important tasks for any Gold trader is to set up their trading entry and exit points. Your entry and exit point are according to your trading strategy which is very important. But you should always set a stop loss when trading. Stop loss and take profit to give a facility to you to set a pre-determined closing price. Your trades will close automatically once the price reaches your pre-determined price.
Understand Market volatility.
For a successful Gold trader, understanding the daily market movement of commodities is very important. If you correctly estimate the volatility of the market your entry and exit points will be accurate and your profit ratio also increases. The movement of currency pairs on daily basis is around 100 to 150 pips and commodities move around 200 pips on average.
