Trading

July 13, 2020

Why These Are The Best Times to Trade Gold – Simply Explained

The commodities market is recognized for its strong fluctuations, especially in the case of gold. Since placing an order at the wrong time could lead to a negative trade, we must analyze the best time of day to expect the best results.

The commodities market is recognized for its strong fluctuations, especially in the case of gold. Since placing an order at the wrong time could lead to a negative trade, we must analyze the best time of day to expect the best results.

The good news is that if the XAU / USD pair shows a lot of volatility, it means that there is liquidity in the market and there can be many trading opportunities. Remember that trading in periods of low liquidity will limit our options to place orders and could put the market against us.

Disclaimer: this article shouldn’t be considered investment advice. This has been written for educational purposes only. Never invest more than what you are able to lose and always request professional advice. 

When should I trade gold?

We can denote lack of liquidity in the chart because (apart from the fact that the volume is low) the sails are more squared and the shadows always reach the same points. Moving in liquid assets is dangerous because with “little” money they can easily sweep us away and the slips between the price we want and the one we obtain can be brutal.

On the other hand, we can target possible entry points when the market presents high liquidity indices, which we can notice due to a high volume and prominent candles with a marked trend. Although gold is almost a 24-hour active market, the most liquid period to enter trades is during New York time, from 7:00 to 17:00 GMT.

Typically, the XAU/USD pair sits in a range and fluctuates from support to resistance until it breaks one of these levels and starts a solid trend. A good trading opportunity is to wait for the price to bounce off a resistance and drop to a support. If this support is exceeded and the price marks strong bearish candles, it is a good indication to place a short order.

If the price fails to search for support points and breaks resistance instead, it is an excellent opportunity to place a long order. As we have mentioned, as long as there is high volume, the opportunities in the market will be more solid and trends can continue their course.

Recommendations

  • The most important trading centers in Europe and the United States overlap in a specific period, which can also be used to find opportunities. Generally, from 1:00 p.m. to 5:00 p.m. is when we can see the most gold activity.
  • Overlapping the Asian and European markets from 7:00 to 9:00 can also form strong candlestick patterns, supported by strong volume acting in response to European market data.
  • The extent of your gold earnings will depend on your target. If you are looking to make a juicy profit with short courses you should analyze possible opportunities during these overlapping periods, although if you want a long course (100 pips or more) you will have to pay attention to the chart at a higher timeframe, in order to plan your target to through the most liquid hours.

We must emphasize that in times of crisis, the price of gold is heavily affected by fundamentals, so it is necessary to educate yourself on the latest events and news to shield ourselves against possible unforeseen trends. On the other hand, we have to be careful when executing our operations, since under no circumstances can we skip the stop loss or change our risk management to continue betting on a position.

The best plan to follow if the price of gold turns against us is to let the market take its course, assume losses (which will be limited by our stop loss) and wait for a new opportunity, which will not be difficult considering how much that gold fluctuates on a daily basis.

AltSignals Team

Proficient authors guiding you with transparency, integrity and education through the finance international markets

The AltSignals writing team consists of experts dedicated to the world of finance and technology, with a particular focus on cryptocurrencies and forex. Our writers bring a broad range of knowledge and experience, cultivated through years of arduous and direct involvement in financial markets, as well as intense technological collaboration.

Editorial approach

At AltSignals, we believe that transparency and education are the key to empowering our readers. Therefore, our content is meticulously researched to ensure its accuracy and thoroughness. Each of our articles is created with the aim of providing educational insights and in-depth analysis, helping both beginners and experienced traders.

Commitment to quality

Integrity is certainly the foundation of our editorial process. The team follows rigorous journalistic standards with careful review, all to ensure that each publication is meticulously researched and exceeds our readers’ expectations.

Our mission is to provide analysis that informs as well as guides users and enthusiasts through the complexities of the cryptocurrency and forex markets. In line with our motto of “quality over quantity”, we guarantee that only the highest quality trading signals are published.

In addition to our commitment, which extends beyond the simple transmission of useful information, our in-depth analysis focuses on profitability and effectiveness squarely, avoiding the common industry habit of prioritizing profit over accuracy. Our traders are strategic experts who offer personalized help to those seeking worthwhile portfolio management tactics.

Diverse knowledge

Our authors are proficient in a variety of topics across the financial spectrum, from emerging trends in blockchain to the nuances of forex trading. This diverse range of knowledge allows the team to cover several topics, ensuring our content is always comprehensive and deeply specialized.

Interactivity and support

We understand that the world of trading can be complex for many. Therefore, alongside producing informative articles, our team is also committed to interacting with the community. Through comment sections, forums and direct support, we encourage our readers to seek clarification and sharpen their understanding, promoting an environment of continuous learning.

Future vision

Looking to the future, the AltSignals writing team is imbued with a vision that transcends regular publishing, and continues to dedicate itself to discovering and reporting on the latest innovations and trends available in the market. We are constantly seeking to improve our skills and expand our knowledge, with the ultimate goal of being a reliable and respected source in digital financial journalism.

There is great commitment to discovering and reporting not only the latest news and trends in the market, but also to equipping our readers with the tools they need to navigate volatile markets with confidence. We firmly believe that, with the support of an appropriate platform coupled with accurate guidance, our readers and traders can turn market volatility into a competitive advantage.

Join us

Follow AltSignals to stay up to date with the latest developments in the world of finance and technology, and explore how our insights can help improve your trading strategies. The AltSignals team is here to guide you through the exciting, dynamic and challenging world of financial markets.

Latest posts author AltSignals Team

Latest posts from the category Trading