What is the best way to trade gold?
In this context, we should note that specific technical analysis tools for choosing the best gold trading strategy will not be discussed in this article. However, we can touch on some of the basic methods that professional traders and major investors follow when trading gold. Which:
- Analysis of news affecting gold
- Study the correlation between gold and other assets
- Study of economic data
- Supply and demand analysis
Analysis of news affecting gold
It is known to everyone that gold, as one of the most important assets in trading, is strongly affected by political and financial events, which can affect its value and make it a safe haven at times.
- To make the matter more clear, the reader can remember the impact of the Russian-Ukrainian war on gold prices, as the price of gold for the first time in its history exceeded the barrier of $2,000 per ounce. Although the price of gold did not reach these levels only because of the Russian-Ukrainian war, investors see wars, crises and disasters as a threat to the stability of the financial system, and therefore they resort to buying gold to protect their money from loss.
- Now you may be wondering how can I benefit from this great news? In this strategy, gold moves in the short term and long term, allowing you to take advantage of trading opportunities on the price of gold.
- As a gold trader, you will keep an eye on the events that caused the price of gold to rise, such as the Russia-Ukraine war. If there are signs of the end of the war, selling opportunities will dominate gold movements, and if the situation gets worse, there will be more buying opportunities in gold.
Study the correlation between gold and other assets
- It is no secret that gold has a strong negative correlation with the US dollar, which means that the movement of gold and the US dollar is moving in opposite directions. If you are receiving a signal to buy gold, it means you should sell the US dollar and vice versa. It is useful to know that one may outperform the other, and you can exploit this opportunity to make profits.
- Although the strength of this correlation between gold and the US dollar has decreased recently, there are many other relationships to which the price of gold is closely linked, and you can benefit from them. Among these assets is the Swiss franc, which is positively linked to the price of gold, which means that opportunities to buy gold indicate opportunities to buy the Swiss franc.
- This strategy may provide an opportunity for small traders to profit from gold movements, in the event that they are unable to execute direct trades on gold due to the small size of their trading accounts.
What is the gold symbol on trading platforms?
- The symbol for gold on global trading platforms is “XAU”.
- It is used to represent gold prices in the Forex market and commodity markets on electronic trading platforms.
What are the steps to open a gold trading account?
Here are general steps to open a gold trading account with trusted trading companies. Please note that there may be slight differences in procedures between different companies, so you should always check the company’s website and its current requirements:
- Search and chooseSearch for the company you want to open a gold trading account with.
- Account registration: Go to the company’s website and look for the “Register Account” or “Open a New Account” option. Fill out the registration form with the required personal information, such as name, address and contact details.
- Identity verification: Usually, the company will ask to upload documents to verify your identity, such as a passport or national ID card and proof of address.
- Funding the account: After identity verification, you will need to fund your account to start trading. You can use the payment methods available in the company, such as credit cards, bank transfer, or digital wallets.
- Choose a trading platform: After funding your account, you will need to download and install the trading platform provided by the company on your computer. Mobile applications may also be available for smartphone trading.
