Precious metal trading is hugely popular in today’s world. In fact, intermediate traders prefer to trade gold and silver due to the strong trending nature of this asset. But to make money in this market, you have to be a very disciplined trader. Without following the core rules of the business and taking trades with precision, it is very hard to make a profit. Assess the portfolio of a successful trader in the United Kingdom. You will learn they were disciplined in every aspect of their trading career.
Considering the complexities associated with gold and silver trading, we are now going to give you five amazing tips to trade gold like a pro. The same rules also apply to the silver market.
Find our trend
You must learn to find the trend in an effective manner. Those who fail to find the trend always lose money since they don’t know how to assess the stages of the price. In an uptrend, if you end up taking short trades, you might see some profit during the retracement phase, but soon the trade will turn into a losing one. Try to find a way in which you can take trades without having any major issues. Focus on the core concept of the trend and try to eliminate hassle at any cost. Take your time and try to improve your skills so that you don’t have to lose too much money while taking the trades.
Focus on your risk exposure
Risk exposure management is very important at trading. You can’t do anything unless you are ready to accept the losses. Though the gold market is very easy to trade provided that you know the proper method of trend trading strategy, still you will lose money in each trade. So, to protect your trading capital, you have to limit the risk. In currency trading, we usually risk 2-3% of the balance. But in the gold market, you should be risking less than 1% of the account. Moreover, stop trusting brokers who give you various bonus offers. Sign up for a free trial with a premium broker like Saxo and see their features. After you get used to a professional broker, managing the risk will be easier.
Avoid trading the news
As a gold trader, you should not trade the news. The price of gold is very sensitive and it can cause massive fluctuation that can result in heavy loss. To keep up your good work, you must depend on the core factor of the market. For instance, if you trade during the FOMC meeting minute, you might lose money regardless of the position. A wild spike might take place in both directions hunting down the trades of retail traders. Think twice before you trade the news.
Learn the major chart pattern
Implementation of the chart pattern trading strategy in the gold market is a premium way to make a big profit from this market. Those who want to protect their capital and trade with the large market movement must learn different chart patterns. Start with the continuation chart pattern and see how it goes. If you feel confident with the continuation chart pattern trading strategy, you should start learning to trade the reversal chart pattern. But this should be done in the demo account so that you don’t have to lose money.
Practice in a demo account
The professional gold trader always encourages to trade in the practice account. By using the demo account, you will know the ins and outs of this business. Try not to trade with real money in the learning stage. Eliminate the thoughts of big profit and focus on developing your skill set. After you become professional at trading in the demo account, make the switch to the real trading account.