During the past few years there has been much talk about Bitcoin and other cryptocurrencies. There are several ways that you could take advantage of the cryptocurrency craze, for instance by mining them or trade them. Did you know that it is possible to trade raw materials such as gold as well? Gold is one of those assets that is considered to be by some as a safe haven asset during uncertain financial times as it might be in demand.
Trading commodities such as gold trading is a trade you may want to consider without the security and storage concerns that come with physically holding the commodity yourself. Since trading gold is considered one of the most complex and volatile Forex markets to tackle, we recommend to check out Vestle platform for gold CFD trading.
Many experienced traders would advise caution before entering the gold trading market due to its large fluctuations and broad pip range. Here are some useful tips on what you should know if you’re interested in getting started in the world of gold trading.
2. Identify the catalysts: Gold contracts are a strange member of the Forex currency field. It occupies an unusual place in the human psyche thanks to its multi-faceted role is history as both an ornament, a symbol of status and a stand-in for physical currency. As such, there are many misconceptions and false opinions on how it behaves as a CFD in the Forex market. Four things have a big impact on the fluctuation of gold: inflation, greed, fear, and supply. Understanding the current mix of these four elements will help you get a better sense of how gold CFDs are going to behave in the near future.
3. Acclimatize to the range: Gold’s pip range can be larger than other CFD instruments even from one day to the next. These shifts can be a little disorientating for some people at first so make sure you are comfortable with the larger numbers before making any big trades.
4. Learn to differentiate the swings from the runs: As a Forex currency, gold is highly volatile and regularly swings 100 pips one way or the other. However, it also goes on consistent runs while everyone is waiting for a reversal. Many traders attempt to identify these trends. Check out Vestle’s live rates and the current fluctuation in gold prices.
5. You may want to consider waiting for candle close: If you have an important decision to make, consider waiting until the candle has fully closed. Gold’s volatility means it can experience big swings even in the last minute of a candle.
6. Have a plan: Try to make sure that your strategy is well thought out and consistent.
7. Beginners beware: Gold is a complex market and it is often a good idea to take on other, less volatile markets before tackling the metals.
8. Avoid the ‘Hail Mary’ approach as well: If you are struggling in other markets, then it would be best to avoid the temptation of jumping into gold trading. For gold trading, it’s best to keep a clear head and not get into desperation.
9. Understand the players: Forex gold trading attracts a particular crowd, such as ‘Gold bugs’ and institutional investors.
The materials contained on this document are not made by Vestle but by an independent third party and should not in any way be construed, either explicitly or implicitly, directly or indirectly, as investment advice, recommendation or suggestion of an investment strategy with respect to a financial instrument, in any manner whatsoever. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 88% of retail investor accounts lose money when trading CFDs with Vestle. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Full disclaimer: https://www.vestle.com/legal/analysis-disclaimer-third-party.html
