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Is Leverage In Forex Haram?

While leverage is a big piece of the puzzle in the world of Forex today – a valuable trading tool and powerful mechanism, particularly relied on by smaller retail investors – a lot of people are hesitant to unleash leverage in their trades.

LeverageOpens in a new tab.

Islam says that riba (interest based lending) is haram and to be avoided at all times, but leverage (especially in the Forex space) certainly operates like a loan – even if there is no specific “interest” involved, confusing a lot of Muslims that would otherwise like to jump into the Forex world.

Truth be told, “is leverage in Forex haram” is a little more challenging to answer than most people think. 

Forex leverage is both haram and allowed depending on your views. Leverage is a loan for a broker, which would not class as Riba, meaning the leverage from your forex broker is halal. However, if the leverage allows for a gambling mentality, this is considered haram.

Is Leverage in Forex Haram? 

When you receive leverage from a broker you are essentially getting a “loan” from the brokerage you are working with, with the express purpose of investing that money – and there is no interest attached.

In that sense, the “loan” you are getting from your broker would not be considered riba. And that means that it wouldn’t be considered haram.

On the flip side of things, though, if you are to take advantage of the leverageOpens in a new tab.

This is traditionally called a margin callOpens in a new tab.

As a general rule of thumb it’s advisable for serious and devout followers of the Islamic faith to avoid leverage in Forex whenever possible.

Is leverage in Forex haram? 

Maybe. But maybe not.

Is that gray area something you are comfortable operating in when it comes to something as serious as your faith, though? 

That’s for you to decide. The whole question of whether forex trading itself is halal or haramOpens in a new tab.

Is It Possible to Avoid Leverage in Forex?

Luckily, though, it is possible to invest and trade in Forex without capitalizing on any leverageOpens in a new tab.

This is (understandably) going to limit the ability for retail investors to make the kind of money that they would have been able to make capitalizing on leverage, though.

For example, with a 50:1 margin on a $200 investment you really gain access to $10,000 worth of cash that can be traded in Forex.

If you make the correct decision with your Forex trades you would have made considerably more money investing your $200 levered to $10,000 worth of capital as opposed to just the $200 you put into your account.

You lose a tremendous amount of power when you avoid leverage trades in the Forex world.

At the same time, though, a lot of Muslims are comfortable with that “drawback” if it means that they do not have to go against their faith.

Once more, it really all comes down to you, your personal thoughts and beliefs on Islamic law, and whether or not leverage a really is considered riba.

It may be something that you want to speak to Islamic faith leaders in your community about before you jump right in.

How Much Leverage Should You Be Using to Stay Haram?

Another interesting perspective on “is leverage in Forex haram or not” is that leverage itself is perfectly fine to use as long as the investment instrument itself is Sharia compliant. 

You would, obviously, have to avoid trading that involved any swap fees whatsoever. And that means almost exclusively using Forex brokerage accounts that have been set up with the Islamic faith in mind. 

Thankfully, these kinds of accounts are really easy to find.

All of the top brokers offer an “Islamic accountOpens in a new tab.

As a general rule of thumb, it’s best to leave any leverage you end up taking to a small an amount as possible.

It’s also important to capitalize on this leverage through Islamic accounts only – the kinds of accounts that do not have standard interest payments attached. These accounts usually charge slightly higher commissions for spot Forex trades (which is perfectly halal), allowing you to avoid any conflicts with haram leverage quantities. 

Those serious about their Muslim faith are also going to want to be sure that they trade “hand-in-hand”.

This kind of trading is fully in line with the teachings of the prophet Mohammed, so long as the trades are executed through a singular broker and trading platform and are entered into and exited out of as quickly as possible. 

Stop and limit orders may be haram and interfere with the “hand-to-hand” trades, but again that’s something that Muslims are going to want to speak to Islamic faith leaders in their community about for more clarification. 

At the end of the day, the answer to “is leverage in Forex haram” is a little more complex than it appears on the surface.

This is something to seriously consider. It’s something to deeply research.

We mentioned earlier that there are a lot of conflicting voices in the Islamic community about leverage, about the hand-to-hand exchange nature of Forex in general, and about whether or not Forex itself is halal or haram.

These are not things to take lightly, not if you are passionate and serious about your faith.

Think on them.

Speak to local leaders and financial experts in the Muslim community that have deeply researched this topic themselves. They’ll be able to help you navigate your personal views on whether or not leverage and Forex in general are haram.

In Conclusion – Is Leverage Halal In Forex?

In summary, forex leverage is both considered halal and haram, in different situations.

For a Muslim forex trader, it’s never about the amount of leverage that you use in your account. It is always about what type of instrument you are trading and how compliant that instrument is with Islamic law.

There are a number of different things to consider when it comes to Forex trading and Islamic law. It’s not as simple as just saying that leverage is always halal or always haram.

Traders should always speak with their local Islamic faith leaders to get a better understanding of what is and isn’t allowed under Sharia law.

What Lot Size Should You Use For A $200 Forex Account?

Beginner Forex traders are going to want to make sure that they lean into this kind of investing by trading lots. Finding the right lot size is a big piece of the success puzzle.

Lot sizes vary (sometimes pretty significantly), and it’s critically important to understand the kinds of lots you are investing with – as it’s going to significantly impact your potential profit and give you insight into the risk your taking on as well. 

But what if you are just beginning in the world of Forex and are only looking to trade $200, for example? What lot sizes good for $200 Forex account trades, if any? 

On a $200 forex account you should be using no more than 0.02 lot size. If your stop loss is large, in pips, you’ll need to be using a lot size of 0.01. If you’re trading with a very small stop loss, in pips, you could use a lot size of 0.03.

What Lot Size Is Good For $200 Forex Account?

When trying to figure out what lot sizesOpens in a new tab.

One of the biggest mistakes that newbies Forex traders make – and it’s one that they make all the time – is capitalizing on every single bit of leverage offered by a brokerOpens in a new tab.

Think about it kind of like this: 

Imagine that you are 18 years old trading again and a credit card company says you can have a limit with $250,000.

At first you are going to want to leap at the opportunity, saying to yourself that you’ve never go crazy and max it out and that you to act responsibly.

If you were to take a step back, though, you’d probably realize that that $250,000 limit might be a bit of a challenge for a young person to handle right out of the gate – and maybe you’d like a limit a little lower to avoid dealing with that temptation.

The kind of temptation that could wreck your financial future right out of the gate.

Skyhigh leverage and a ton of margin from a Forex broker as a new trader is a lot like that.

This is why so many recommend that Forex traders with $200 go for a 50:1 leverage play – sticking to about 2% margin or so.

Some even like to recommend a 25:1 leverage play (1% margin) just to make sure that risk is really mitigated and managed when you are just getting started.

If that’s the approach that you decide to take you need to understand the lots you are going to be limited are generally under the “small increment” or “micro lotOpens in a new tab.

What lot sizes good for $200 Forex account holders?

That micro lot!

How Much Should You Risk Per Trade on a $200 Forex Account?

So how much should you risk per trade when you are dealing with a $200 Forex account?

Well, that’s a real individual choice and comes down to a couple of things.

For starters, what are your investment goals trading in the Forex world to begin with.

Are you looking for quick cash and short positions?

Or are you looking for longer positions that may take a wild to mature, but have the potential to unlock significantly larger profits. 

Maybe your goals are somewhere in between – or something else entirely!

Those goals are going to heavily inform how much you need to be risking on all of your trades when you’re funding your account with just $200.

For instance, if you’re scalping the forex marketsOpens in a new tab.

Secondly, you need to think about the lot size that you are shooting for.

As we mentioned a moment ago, most people trading with $200 in their account are going to want to focus almost exclusively on micro lot positions.

With a 2% margin/leverage position on a micro lot you are looking at risking four dollars every single trade.

Obviously, you need to make sure that you have stop losses in place to protect your nest egg as well. All it takes is a single margin call at 2% of $200 to wipe out almost all of your money – a margin call at that point would have you forking over $194 (and your four dollar position), leaving you with just two dollars left.

Using Lot Size Calculators in Forex

Most quality Forex brokers are going to give you access to lot size calculatorsOpens in a new tab.

These lot size calculators are game changers!

They give you all of the information and insight you need to know to better understand the kind of lot sizes to shoot for, the amount of money you’ll be putting up (and risking) should a margin call occur, and a whole host of other details that make it a lot easier to trade Forex – especially if you want to trade someone aggressively with a smaller budget.

Take advantage of these tools at every opportunity.

If you can’t find a calculator like this with your broker you’ll want to jump online and search for lot size calculators that are 100% free and provided by legitimate Forex operations. I’d highly recommend using the free lot size calculatorOpens in a new tab.

Don’t go with Forex calculators from fly-by-night companies or websites or operations outside of the Forex world. They may not be providing you with the most accurate and up-to-date information available. 

That could get you into positions that you wouldn’t have jumped aboard otherwise.

No, use legitimate calculators and you’ll have nothing to worry about!

There are also ‘in app’ calculators that actually sit on your chart in the Metatrader 4 platformOpens in a new tab.

In Conclusion – What Lot Size Should You Be Using For A $200 Balance Forex Account?

In summary, you should be using a lot size of 0.02 for the majority of trades on a $200 balance account when Forex trading. This will give you a maximum position size of $4 per trade, meaning that your risk on any given trade is limited to $4. You should also be using stop losses to protect your account equity in case the market moves against you.

Lastly, make sure to use a quality Forex calculator to better understand what lot sizes you should be using for your account balance, your investment goals, and the level of risk you are willing to take on. These tools are crucial for success when trading Forex with a smaller account balance.

What’s the most you’ve ever made from a $200 account? Let me know in the comments down below.

How To Avoid Swap Fees In Forex (Step By Step)

Understanding how “swap” happens in the world of forex – and how to avoid swap fees in forex, too – is critically important for beginner and master traders alike.

If you are serious about making money in the Forex market (we are talking serious amounts of money) you need to do your level best to mitigate and eliminate fees as much as possible. Fees might not look like much on the surface but they pile up in a hurry – and before you know it you are seeing a huge chunk of your forex profits eaten away without you even realizing it’s happening.

You can avoid paying swap fees in forex by:

  • Closing all open positions before the market closes at night.
  • Trading in the direction of the positive swap on the currency pair.
  • Using an Islamic trading account.

How to Avoid Swap Fees in Forex

To kick things off, it’s important to understand exactly what swap feesOpens in a new tab.

To put it bluntly, a swap in the world of forex happens if you are holding open positions overnight.

If this is your situation you’re going to find that your account is either credited or debited, depending entirely on the specific trade direction and traded pair.

Sometimes swap charges can be referred to as “rollover feesOpens in a new tab.

It’s important to remember that when you are trading currencies in the Forex world you’re actually trading cash.

When you trade “longOpens in a new tab.

On the flip side of things, if you trade “shortOpens in a new tab.

In the Forex world, though, if you are holding a currency pair that has one currency with a positive balance (the long position) and a currency with a negative balance (the short position) you’ll end up dealing with a “interest-rate differential”.

Now let’s run through avoiding Forex swap fees. There are three key ways you can avoid swap fees altogether.

For starters, you can trade in a direction of positive interestOpens in a new tab.

The idea here is to trade only in the direction of the currency you’re looking at that gives a positive swap. This gives you the most favorable direction, especially when you are back or forward testing your trade strategies.

Secondly, you could trade only intraday and close out all of your positions as soon 10 PM GMT hits on the clock.

This approach allows you to avoid swap because you get in and out of the Forex market before you get into rollover time. Of course, being an intraday trader is not for everyone – and not all forex strategies have room for this swap fee avoidance approach, either.

That’s where the third strategy comes into play.

Trading on Islamic Forex Accounts to Avoid Swap Fees

Learning to trade on Islamic Forex accountsOpens in a new tab.

These kinds of accounts are available to anyone and everyone (Muslim or not) and are designed to be run in full compliance with the beliefs of Islam.

One of those tenants is that there can be no interest whatsoever paid on business transactions. The second that interest is included into the mix that type of behavior is considered haram and needs to be avoided entirely. This leads into the bigger argument of whether forex trading itself is Halal or haramOpens in a new tab.

Islamic swap free accounts guarantee that positions are closed out before swap could even become a factor. They are well worth a closer look if you want to be sure that you aren’t getting slapped with any swap fees!

Are Forex Swap Fees Charged Daily?

Forex swap fees are in fact charged daily if you are holding a position overnight, when swing tradingOpens in a new tab.

As we mentioned a moment ago, the swap fees that you might be looking at are always going to be significantly influenced by the underlying interest rate attached to each of the two currencies in the pairs that you are trading.

If you hit the daily rollover point (sometimes called 00:00 server time) you get into swap fees automatically.

Traders that operate 100% intraday only are really never going to have to worry about getting into rollover time, dealing with swap fees, or navigating these often expensive decisions.

It’s critically important that you make sure you aren’t getting into rollover time when you are investing in forex if you want to avoid swap fees as well. 

We highlighted three different strategies earlier to help you avoid these kinds of expenses. They are rock solid approaches to pocketing more of your profits, keeping you from paying high interest rate differentials, and dealing with the inevitable headache and hassle rollover brings to the table.

Lean into those strategies. 

Rely on them to help you avoid swap fees altogether, even if you aren’t interested in becoming an intraday trader.

You’ll also want to look into the details behind how your broker calculates rollover time, how they calculate swap fees, and whether or not you are going to be responsible for ponying up the cash to cover your swap fees on a day-to-day basis or if you can pay them in aggregate.

Remember, though, that carrying trades are a huge part of the forex landscape.

The odds are pretty good that if you’re not intraday trading you’re going to bump up against the potential for these kinds of fees, especially if you aren’t using our strategies from earlier to eliminate those fees altogether.

You’ll want to calculate these kinds of fees into all of your trading decisions to make sure that the profitable position your about to take isn’t just smoke and mirrors!

In Conclusion – How Can You Avoid Swap Fees In Forex?

In summary, you can avoid swap fees by:

The forex market is a great place to invest, but you need to be aware of the fees associated with trading. Swap fees can eat into your profits if you’re not careful. Luckily, there are a few ways to avoid them.

How do you avoid paying swaps on your trading positions? Let me know in the comments down below.

Should I Hold Forex Trades Over The Weekend?

Holding a Forex trade over the weekend can be a bit of a risky proposition – but it can also be a wildly profitable one, too. Every single weekend Forex traders the world over are faced with a huge decision:

Hold their positions, let those positions ride over the weekend (when things have the potential to gap up), or liquidate their positions on Friday and hope to get back in on the action on Monday when they see what the market looks like.

Both of these choices have their own pros and cons. Both of them can prove to be incredibly smart and incredibly foolish. You’re wondering “should I hold Forex trades over the weekend” and aren’t sure of which way to go, this detailed breakdown is for you!

You should hold forex trades over the weekend if you’re a swing trader, looking for a relatively large move in the markets, which will take weeks of price movement to complete. You shouldn’t be holding trades over the weekend if you’re a scalper or day trader as the weekend market gaps could be much too large for you to absorb when the market reopens.

Should I Hold Forex Trades Over The Weekend?

The Forex market closes down at 5 PM EST every Friday and then re-opens at 5 PM EST on Sunday.

You can set your watch to it!

There is a tremendous amount of opportunity that can bubble up between 5 PM on Friday and 5 PM on Sunday. But you could also be dealing with a gapped up situation that wipes out your position completely, doing worse than his setting you back to zero – maybe even breaking your Forex nest egg. 

That’s not the kind of position anybody wants to find themselves in. 

Should I hold Forex trades over the weekend, though?

Well, that really all comes down to whether or not you are swing trading.

Swing tradersOpens in a new tab.

Of course, you need to be sure that you are paying close attention to the kind of trendlines that are happening towards the end of business on Friday.

If the overall trendOpens in a new tab.

If, on the other hand, you notice that the current trendlines are supporting the position that you’ve taken you might be much more inclined to “let it ride” – giving yourself an opportunity to cash in on positions that other swing traders might have otherwise exited. 

At the end of the day, it really all comes down to the strategies you are using, the context of the market in the moment, and your own specific goals as well as risk tolerance.

What Happens If I Forget to Close a Forex Trade Before the Weekend?

What happens if you forget to close a trade before the weekend?

Well, it’s not like you are going to lose that trade or like it’s going to be deleted from your Forex broker. It’s nothing like that.

You may, though, have to worry about significant gaps in the market bubbling up – especially if big economic news regarding the currency pairs you are trading happens while the market is “paused”. 

Anyone that has spent any amount of time trading Forex in the past has got slammed by this tsunami, especially if they were swing trading and holding over a weekend.

Everything looks peachy on Friday around 5 PM when the markets shut down. Almost immediately after, though, terrible news gets leaked and things only get worse and worse through the evening and into Saturday. 

By Sunday afternoon things are really reaching a fever pitch. You can almost see the sharks in the water.

When the bell opens on Sunday at 5 PM EST things can get all kinds of crazy – all because of news that broke when you were prohibited from making moves on the Forex market at all.

The most unfortunate thing about these kinds of gaps occurring, though, is that they are almost always unpredictable. 

You never really know when the next big bombshell is going to drop that shakes things up completely. 

Why Shouldn’t I Hold Forex Trades Over the Weekend?

Should I hold Forex trades over the weekend even though gapping up can occur?

Once again, it really all comes down to the kind of trading strategies you’re utilizing and the amount of risk you are willing to tolerate.

Some people are going to be able to ride out pretty much any storm, no matter how rough things get. Other folks are going to get real spooked the moment that it looks like the tailwinds have turned against them.

Your biggest risk (aside from the spontaneous negative news drops we highlighted above) is that the gaps are going to bubble up, your stop losses aren’t going to get filled, and you are going to be forced to take it on the chin almost instantly the moment that the markets open back up on Sunday. 

If you are swing trading, though, and don’t plan to exit these positions in the immediate, short-term basis there’s a whole lot less to worry about. 

Day traders, though, are going to want to liquidate their position on a pretty regular basis (like every day). The last thing that a day trader wants to worry about are gaps that bubble up over the weekend when they wouldn’t have been able to make any moves. 

That kind of limitation to trading autonomy doesn’t work for day traders. 

Swing tradersOpens in a new tab.

If you are pursuing swing trading in the Forex world (or specifically swing trading currency pairs because of current market context) the odds are pretty good you’ll do okay over the weekend.

When you get right down to it, matching a Forex trading strategy into your Forex trading goals is the best way to manage and mitigate risk. If you’re going to be holding over the weekend make sure that you are aligned with that decision and you won’t have much to worry about!

In Summary – Should I Hold Forex Trades Over The Weekend?

In conclusion, you should only hold forex trades over the weekend if you’re a swing trader looking for a huge move within the markets, and if you’re comfortable with the risks associated with unpredictable news. If you’re a day trader, or your goals don’t align with swing trading, it’s best to close any open trades before the weekend begins!

Market gapsOpens in a new tab.

Do you leave trades open over the weekend? Let me know in the comments down below…

What Are The Best Currency Pairs For Forex Swing Trading?

The real secret to success in the Forex markets is finding a trading strategy that aligns with your goals. Mixing and matching long-term tactics with short-term goals (or vice versa) is a surefire way to burn up your investment capital, tank your odds of success, and inevitably compel you to pull your money out of Forex altogether.

If you are going to be trading in hopes of piling up short-term profits (big short-term profits, too) you need to learn the ins and outs of swing trading. On top of that, you need to learn how to identify the best currency pairs for swing trading Forex and focus all of your efforts exclusively on those pairs and this strategy. With that being said, which forex pairs should you be using for swing trading?

The best forex pairs to swing trade are those pairs that frequently trend, for instance, EURUSD, GBPUSD, EURJPY and USDCAD. Any pair that is influenced heavily by economic factors will make a great pair for swing trading, hence why most USD pairs are great for swing traders.

Which Forex Pairs Are Best for Swing Trading? 

Swing trading Forex is often compared to daytrading, but while the two are similar in their short-term strategies swing trading is a different animal altogether.

DaytradingOpens in a new tab.

Swing tradingOpens in a new tab.

On top of that, swing trading also offers a little more trading time flexibility, allows you to more clearly identify your positional boundaries to enter and exit different trades, and helps protect you with smaller stop losses.

The trick, though, is finding the right currency pairs that allow you to make money on these kinds of swing trades.

That’s why it’s so valuable to focus exclusively on the best currency pairs for swing trading Forex when you’re trading according to this strategy.

What are those currency pairs, you ask?

Well, history shows us that the best pairs to trade with swing strategiesOpens in a new tab.

Sure, they don’t have the same kind of volatility that other currency pairs have. But that’s a good thing with a swing strategy.

Focus your attention on pairs like:

…and you’ll find that your swing trading strategies become a lot easier to execute. 

Which Forex Pairs Don’t Work for Swing Trading? 

Just as important as finding the right pairs to trade is making sure that you steer clear of pairs that cannot produce with this strategy.

The kinds of pairs you want to avoid as much as possible are the more exotic pairsOpens in a new tab.

These pairs are a lot more volatile than major currency pairs and a lot less liquid. That makes them tougher to predict and tougher to swing reliably. The unpredictability and volatility means they can swing one way and another before you even have a chance to execute your positions.

For these reasons (and more) you want to do you level best to keep clear of minor pairs and exotics. They just don’t have the kind of consistency that you need when you’re looking to make moves as a swing trader specifically.

Using Major Forex Pairs for Swing Trading

If you want a shortcut to success with swing trading Forex it’s import ant to focus on a handful of technical indicatorsOpens in a new tab.

Moving averages give you the kind of insight you need (especially longer term moving averages) to spot trend reversals. Not only that, but they can also give you the insight you need to spot the potential strength of the reversal. 

That’s a big piece of the puzzle. Not only do you need to see the new swing coming, but you need to know if it’s worth getting positions on.

The Relative Strength IndexOpens in a new tab.

RSI should help to identify if you’re looking at bullish or bearish setups as they come together. This is huge for spotting a new trend in the short term, giving you the green light – or the red light – for a swing trade.

If you spot an RSI that climbs beyond 70, the chances are pretty good you’re going to see a price decline due to overbuying. If you see an RSI that drops below 30, the odds are good you’re looking at underbought positions that should shoot up in the short term.

Of course, it’s also important to be sure that you’re looking at things like lines of support and resistance as well.

Technical analysis is a big part of successful swing trading Forex. You need to be nose deep in the charts, sticking to your trading strategy, and only looking at the major pairs (like the ones we highlight above) to improve your odds of success.

Stick to the info we shared in this guide for swing trading, though, and you’ll be able to make many more successful trades in the world of Forex than you would have been able to otherwise.

Have the right blueprint for swing trading and you’ll be able to generate some real money with Forex!

In Conclusion – What Forex Pairs Should I Use For Swing Trading?

In summary, the best forex pairs to swing trade are pairs influence by economic factors like EURUSD and GBPUSD, as well as USDCHF, USDJPY, EURJPY, AUDUSD, and NZDUSD.

You should avoid trading minor pairs and exotic currencies, which can be more volatile and less predictable than majors. Use technical indicators like moving averages and the RSI to help you enter trades at the right time.

Which currency pairs do you like to swing trade? Let me know in the comments below.

How To Read Pips On Gold?

Learning how to read Pips on gold can help you make the right trading strategy and give you a better way of analyzing your trading results. Gold is one of the most common metals and is more likely to reward you for your training efforts. They were learning how to read pips on gold can help you get the maximum returns for your trades and give you everything you need to calculate profits, losses and lot sizes needed!

You can read pips on Gold by looking at the value per ounce. For instance, you could buy XAUUSD at $1900.00. If you sold this back to the market at $1950.00, you would have made a profit of 5000 micro pips. This equates to 500 standard pips, as you would see in the forex market.

Reading Pips On Gold On MetaTrader 4

PipsOpens in a new tab.

Most traders don’t calculate the number of Pips, and instead, they ask how many cents or dollars gold is going up or down. MetaTrader calculates gold Pips based on the dollar amounts and the lots available. The best way to count pips on gold on MetaTrader is to remember that $1 is one micro lot or 100 Pips, and you can then do calculations from there. 

On this Tradingview chartOpens in a new tab.

This is why you need to be extremely careful when taking trades on XAUUSD. As a general rule of thumb, if you’re usually trading 0.1 lots on EURUSD, you’ll want to be using 0.01 lots on Gold. The pip value is roughly 10 times more.

How To Calculate Forex Lot Sizes On Gold

One lot size for gold has 100,000 units, and one pip of movement is worth $1. For example, if the gold’s price goes from 1800 to 1800.01, that is one movement for one lot worth $1. If the price goes from 1800 to 1801, then that’s a 100 Pips move for one lot worth $100. 

You can calculate the lot size by considering one lot as $0.1 for one pip move. For example, if you buy one lot, the price goes from 1800.99 to 1801.99 or 100 Pips gained. This will mean you have a profit of $100. 

As I mentioned above, I’d recommend using 10% of your usual lot size, when trading gold. For instance, if you typically use 0.2 lots per trade on GBPUSD, I’d recommend starting at 0.02 on Gold, if not lower!

The Benefits Of Trading Gold Instead Of Forex

One of the main benefits of trading gold instead of Forex is it is easier to read the fundamentals on gold than currency pairs. Before getting involved in gold trading, you must be aware of all of the friends and other benefits that you can get from trading in gold.

The following are some of the benefits that you can expect for Roman trading in gold though they are not all of the benefits, and which one’s apply to your specific experience will depend on which Traders you’re working with. 

Security and Reliability

A lot of traders consider gold trading to be safe and reliable. This is because the value of gold tends to say unaffected by inside economic situations. This means that the government’s Financial controls or Central Bank regulations don’t affect gold in the same way since it is mainly a value store. So, inflation rarely affects the pricing of gold, rendering many currencies worthless. 

Gold is also a lot cheaper than currency trade, which means that it’s easier for the average person to start trading because there’s less price upfront. As a result, gold has the highest trading volume compared to other currency pairs, and gold also tends to have a slight difference between buying and selling prices. 

Gold tends to have a price that goes higher each time, making it possible for the gold trading industry to help traders who wish to earn substantial amounts. Trading gold online allows traders to make extra money faster than entering the supply marketplace. 

Note that the value of gold rises and drops very quickly and tends to be in large amounts. You should also keep in mind that gold is chiefly traded against the US dollar, implying that the dollar’s value will indirectly influence gold’s price. If the US dollar value rises, then the cost of gold will fall.

However, there is still be potential to make a lot of money because of these rapid fluctuations. Since gold allows you to keep up-to-date with quotes constantly throughout the day, you should be able to have a good idea of what those fluctuations are going to be like. 

Easier Mechanism

The pricing mechanism for gold is more accessible than the mechanism for foreign exchange markets, and only a few factors can affect the gold market and its parameters. Because of this limitation, it’s easier to comprehend and predict Trends in the gold market than in the Forex Market. So this allows for the execution of Trades depending on predetermined parameters, which is extremely useful for saving time. 

Gold is also actively trading 24 hours a day, giving it an edge on Foreign Exchange. Some Forex trading that closes when New York closesOpens in a new tab.

Less Storage

By far, one of the most significant benefits of doing online trading and gold is that you don’t need to move or store or anything physically. It allows you to get experience with exposure to the actual prices of gold without requiring that you have to store physical coins or bars or move any equity around. 

Access to Constant Quotes

Trading gold online tends to grab the attention of beginners and experts because it enables you to receive constant quotes and because regular quotes are possible by the continuous evaluation of live data. With the help of the internet and the recent modernizations in trading, you are now able to trade in gold even if you are an everyday trader.

In Conclusion – How Do You Read Pips On Gold?

Learning how to read pips on gold is a fundamental skill that you should have when getting into gold trading. It will allow you to understand better why a lot size matters and how movements can affect your overall profit. There are many other benefits of trading in gold, such as security and easy accessibility, and there’s also a large margin of profit.

You can read pips on gold (XAUUSD) very simply by looking at the number of digits that follow the decimal point. The fourth digit is the pip and this is what you should be watching to make your trades. Remember that gold moves very quickly and so it’s important to always have up-to-date quotes in order to make sound decisions. Stay safe and trade smart!

Do you trade gold? Let me know in the comments down below!