Gold soars toย two-week highsย following weaker-than-expectedย USย GDPย ย
While the US GDP rose to pre-pandemic levelsย as a result ofย the generous economic stimulus packages,ย it still fell short of analystsโ expectations,ย thereby spurringย another gold rally.ย ย
Gold prices have been trending upwards recently thanks to the dovish policy of the FOMC, which decided to keep interest rates unchanged on Wednesday, while Thursdayโs weaker-than-expected US GDP gave another boost for gold bulls.ย
As the USย dollar suffers fromย the aftermath of the FOMC meeting and the weak GDP data, XAU/USD traders have managed to stage anotherย rally.ย ย
XAU/USD is currently tradingย nearย $1,830, the latest resistance level from which it bounced off two weeks ago. If momentum picks up and prices manage to pierce thisย zone, we could see an extended breakout towards $1,850 and beyond.ย ย ย ย ย
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How to tradeย goldย onlineย
Aspiring traders and investors can easily start trading gold as well as several other valuable commodities online through financial derivatives which track the price of gold on the financial markets.ย
Speculating onย the price of goldย withย Contracts for Difference (CFDs)ย allows clients to achieve substantial returns regardless of the market’s direction or the amount invested.ย ย
In addition, CMTrading clientsย can also benefit fromย the powerful leverageย offeredย across a variety of assets andย enjoyย much higherย returns than their initial investment would allow.ย ย ย
For example, opening aย BUYย positionย of 1 lotย in gold (XAU/USD) at the price ofย 1,827, which was the average going rate on theย 30thย ofย July,ย 2021, and closing the trade atย 1,840ย โย a 13 pip difference โ we would gain near $1,157.ย
Obviously, if the price of gold didn’t move to the upside, or if we failed to close the position during the runup above our entry point – this trade could have turned into a loss.ย
Therefore, in order to manage risk effectively in the long run, it is always important toย developย aย risk managementย strategyย andย makeย useย ofย the stop-loss orders availableย on the trading platformย every time you open a position.ย ย
That being said,ย CFDsย alsoย allow traders to profit even if the prices are moving downward as well. Using the same example as above, if the price of gold moved in the opposite direction and dropped from 1,827ย toย 1,810, traders withย SELLย positions would enjoyย returns upwards of $1,500.ย ย
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Discover more opportunities with CMTradingย ย ย ย
CMTrading offers more than 150 tradable assets including the most popular commodities available in the markets. CMTrading clients get access to the global oil markets, exceptional trading conditions and robust safety and security under the auspices of the Financial Sector Conduct Authority (FSCA) in South Africa.ย ย ย ย ย
Being a retail brokerage that specializes in CFDs (Contracts for Difference), CMTrading provides clients with unique advantages such asย 100:1 leverage on gold, which allows traders with smaller accounts to gain exposure to much larger positions. This translates to substantially higher profitย potential,ย however, it should be noted that leverage also increases your exposure to downside risk.ย ย ย ย ย ย
On the other hand, while leverage typically adds a certain degree of risk to any investment, CMTrading also offers negative balance protection, thereby guaranteeing that potential losses will never exceed your invested capital.ย ย ย ย ย ย
If you are interested in learning more about how you can take advantage of price movements in the best-performing commodities orย seek to gainย from fluctuations in the exchange rate of currency pairs, you will find that CMTradingโs unique offering of innovative services and diverse account types are suitable for both beginner and experienced traders.ย ย ย ย ย
Start trading the financial markets today with an award-winning broker. Join CMTrading, the largest and best-performing broker in South Africa.ย ย ย ย ย ย ย
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