Online gold trading is one of the most exciting and rewarding fields of Forex. Gold is a unique commodity and often demonstrates fascinating relationships with currencies and economic systems. Thanks to modern advancements in information technology anyone can set up an account and start online gold trading in just a few hours.
How do I start online gold trading?
The first step is to open an account with a good Forex broker. In order to trade Forex you need to stake something, so an initial cash deposit is required. This is usually between one and ten thousand dollars depending on the preference and prestige of your broker.
Your broker will provide you with trading software and your account will be integrated with their systems. This means you can keep track of Forex updates in real time and place orders from your own home.
How does online gold trading differ from trading currencies?
Gold possesses a number of qualities that make it unique. The value of a currency is typically tied to the economic performance of its parent country. For this reason currencies are vulnerable to economic recession, political instability, environmental problems or natural disasters, etc.
Gold on the other hand is immune to all these factors. Gold is seen as something of a safe haven commodity. When there is doubt about traditionally successful currencies such as the pound sterling, traders and investors flock to gold as means of weathering the storm so to speak.
Gold traders look for signs of oncoming uncertainty surrounding such heavyweights as the US dollar, the Euro, the Yen, etc. They also keep an eye on goings on in gold producing countries; for example war in a gold producing country might limit supply and thus drive the price up. Alternatively an increase in the value of gold might improve the performance of currencies in gold producing countries. These are the kinds of patterns that gold traders examine.