Trading commodities is one of the most popular ways to make money. But as any field, it requires following the rules and looking for great tips. In order to be successful you need to get as much information as possible, so. Here are the tips for successful trading of gold.
1. Pay attention to the market.
2. Check all of the possible indicators.
3. Maintain your attention on volume.
4. Look for the high and low points of the previous trade.
5. Look into other possibilities.
6. Look after all the time frames.
7. Do not focus on gold.
1. Pay attention to the market.
We need to follow the behavior of the markets pretty close when we are looking trading off gold as the markets tend to play close to the chest and we need to really see what is the cards for the next trades for us. That is why following all of the trends is important for us. Because by mistake we can get stuck in the trend that is going to take us all down.
2. Check all of the possible indicators.
It is no secret that in order to understand what is going on we need to use all of the technical indicators in our disposal. That is why we need to look for all of the possible hints using all of the possible tools. And if you are a gold trader I would also highly recommend to use all of the technical tools on dollar graph simultaneously, as gold and dollar are always dancing with each other.
3. Maintain your attention on volume.
Pay a lot of attention to the volume-rally relationship. With gold there are four rules for it:
- If rally sees rising volume – a bigger rally is about to start;
- If rally sees declining volume – the rally is about to end;
- If decline sees rising volume – decline is going to go on;
- If decline sees declining volume – it has no meaning for the future trades.
It is worth noting that it’s important to see whether these relations have worked before in the similar situations. These are more of the guidelines for the price behavior, not set rules and we need to be more careful about them.
4. Look for the high and low points of the previous trade.
High and low points of the previous trend are the perfect indicators that are going to serve as the support and resistance levels for the following trade. That is the relations that has been long set in gold trading.
5. Look into other possibilities.
Look into the options of stepping away from your style of trading and into something more stable and more exciting. Try longing, try looking into other metals, if that is what you are interested in. Although gold is the king of this segment of the market, it is possible for us to be interested in his pages as well, don’t you think?
6. Look after all the time frames.
Even if you prefer shorting, you need to understand that mid-range trading as well as the long term investments can be quite fulfilling when it comes to earning off gold. Although shorting is more preferable, there are strategists who are going to argue with you on the point. Whether to listen to them or not is your decision, but I, personally, would.
7. Do not focus on gold.
As I already said, if you are not having any luck with gold, you might as well turn to other assets as look at. In case you are interested in metals, each of them has their own dynamic and can be deemed a rightful member od traded assets community, so to speak.