The price of gold is measured in U.S dollars. A slight change in the U.S dollar index usually results in massive fluctuation. The rookies in Singapore don’t know this fact very well and often think gold trading is hard. In order to make a profit, you must trade a volatile asset. With gold, you are going to find everything you need to earn money. But still, thousands are traders are losing money because they often ignore the most basic rules for trading the gold. Let’s find out more about the perfect way to trade the gold market.
1. Find the trend
The first thing which you need to do in gold trading is to find the trend. Without taking the trade in favor of the trend, no one can make a profit in gold trading. Trading gold is like riding a trend. Use the Fibonacci retracement tool to find the perfect point to open a new long trade. Once you have executed the trade, make sure you are not taking too much risk. The trend is not perfect. You might experience a sudden change in the trend so be prepared to lose trades.
Rookies should start trading the gold with the simple trend line tool. Using sophisticated indicators and trying to find the perfect price to secure good trades is not going to work. In fact, the simplest trading method is the best trading strategy for gold trading. If you stick to this method, you can expect to become a professional gold trader.
2. Analyze the major news
In the CFD trading industry, analyzing the major news is very important. If you ignore the news, it’s just a matter of time to blow up the account. The majority of novice traders don’t give any importance to the news. But trading gold is not like dealing with the currency market. The top traders in Singapore often take trades on gold by using fundamental analysis. So, you can understand that fundamental analysis is very important in gold trading.
Starting to learn about the news factors is a tough task. But if you follow the basic protocol and try to execute the orders with managed risk, you will learn to deal with the complex nature of the market. Once you become good at analyzing the major news, you will learn the perfect way to reduce the risk of trading.
3. Learn the price action signals
The price action trading method is the most efficient way to make a big profit. To trade gold, you must use the most reliable price action signals. Once you become good at analyzing the price action pattern, you will become more confident. Rookies often say, analyzing and memorizing tons of patterns is impossible. But you don’t have to memorize the pattern. Just have a look at the anatomy of the candle and try to understand its functions.
Getting into the details of the Japanese candlestick pattern has a huge advantage. It will help you trade with a tight stop. In fact, you can even trade the major news. Once you become skilled at analyzing the major news, you can easily change your life and become a top trader in the world.
4. Never break the rules
Breaking the rules is the most common causes of losing money in trading. Since the gold market is very volatile it is important to follow the safety measures all the time. If you think you know everything about this market, you are wrong. The top traders are still learning about the CFD market and they keep themselves updated with the latest market news. It allows them to take the trade with low risk. So, think about the actions when you trade in such a delicate market. Stop being an aggressive trader to recover losses. Just go with the market flow and aim for a high risk to reward ratio in each trade.