Beginners Guide For Trading Gold on Forex 2022

gold

Shiny, malleable and conductive, gold is easily the most traded precious metal today. With uses ranging from jewellery to circuit boards, gold is never short in demand from various industries. Gold price charts are shaped by supply and demand, which are in turn, shaped by present economic conditions. Gold is regarded as one of the safest commodities to trade, with a lot of beginners and experienced traders using it for short term as well as long term investments.

Why should I trade on MT4?

The portal to the world of trading is through a trading platform. To trade gold, you should opt for a trading platform that offers the opportunity to trade commodities. A remarkably favoured option for beginners and experts alike is Metatrader 4, or MT4 for short. MT4 offers traders nine different time frames, 30 indicators and three types of charts to suit their style and strategy. Despite being released in 2005, MT4 remained the more popular choice in comparison to its successors and predecessors. This is largely due to its comfortable interface, user friendly design and having just the right number of tools and options. MT4 also claims to have the highest security standards a platform could offer. All these features combined makes MT4 an exemplary choice when picking the right platform to start trading gold on forex.

Find a MT4 VPS for forex trading

Commodities are highly volatile compared to stocks. Trading gold requires low latency, fast and secure connections to trade profitably. Moreover, if the trader is using an EA or an automated trading bot, the system containing the software will need to remain powered on throughout the day to achieve the best out of it. Creating a setup that hits all of these checkboxes would be monetarily unaffordable to most people.

Using a virtual private server will eliminate most of the demons that lurk in your path to trading successfully. Subscribing to a VPS for forex trading will introduce a fast and secure virtual computer in-between you and the trading platform you wish to trade on. A VPS is capable of running your automated trading software constantly throughout the day, even while you are asleep. Latency issues will be non-existent since most VPS hosting providers add an extremely high speed network connection as a part of the package. The subscription fee to a VPS is many times lower than the cost of setting up a similarly powerful system physically, purchasing each component individually.

Some other benefits of using a VPS are:

  • Availability – With a network connection and a compatible device, you are able to access your VPS anywhere at any time. Your trading activities are not limited to your desk, unlike your physical computer.
  • Reliability – Unlike a physical computer, a VPS will not overheat and be forced to shut down in the case of a power emergency.
  • Security – Using a VPS is a far safer option than your own personal computer, most of the time. Reputable VPS hosting providers are likely to have dedicated staff members to monitor network upkeep.
  • Safe backup and recovery – Forex VPS hosting providers provide the options to backup and recover data, in case a critical file gets corrupted/ lost.

With a plethora of options available, picking the right forex VPS should be decided with more than just the price tag in mind. There are some important factors to consider when picking your VPS hosting provider to trade on MT4, such as privacy, efficiency, uptime and customer support. VPS hosting providers such as RouterHosting VPS provide traders with guaranteed uptime paired with unparalleled security, easily securing the spot for the best forex VPS in 2021.

Practice and Gain expertise on MT4

MT4 offers users an option to sign up for a demo account, which contains the same features and charts to simulate real time trading while without the risk of losing capital. The demo trading account will be furnished with a large amount of fake currency which the trader could use to long or short positions. Trading is easy to learn with MT4 thanks to the rather simple interface, even for traders who are new to the market. A demo account can also be used to test out an EA or your automated trading bot, since it could be risky to use real funds without knowing for certain that your trades will be profitable.

While it is unlikely that there will ever be a human or bot trader that will trade with profits 100% of the time, almost everyone will be able to increase their gains over time as they gain experience and develop better trading strategies. With the large amount of indicators, timeframes and securities available on MT4, you would gradually build your trading skills and learn to time the market better.

Exchange or spot? Choose your type of gold

The XAUUSD rate will vary based on the option you are trading. Picking the right type of contract should be determined considering your skill, experience and trading strategy. The 2 most popular options you could trade gold in the forex market are:

  • Spot trading – this is sometimes referred to as liquid markets, since all transactions occur instantly. You could sell or buy gold for the immediate XAUUSD price, with the agreement of both parties. Spot trading opens the door for day trading, since you could execute multiple trades within a short amount of time. This is also the best option when choosing to invest and hold for a long period of time, since there is no expiry date.
  • Futures contracts – A future contract is an agreement to execute a trade for a specific rate on an agreed upon time in the future. The price is determined by the spot price of the underlying asset when a contract is entered, along with time, interest and carrying costs. Leverage and flexibility are among the benefits of trading futures contracts.

Use platform and open trade

MT4 is available on both smartphones, Linux and Windows operating systems. Upon downloading the app, you will be required to set up your trading account with the necessary security features, and transfer fiat to your trading account. You could get started right away and open your first Mt4 Gold trade with no further steps or complications!

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