Precious Metals Trading

Gold and Silver Trading

Gold and Silver are two metals that serve many purposes. From being adorned as jewelry, to being used in the industrial and manufacturing sector, as well as serving as an alternate form of investment in the currency markets. Many consider gold and silver to be the purest form of currency, devoid of any manipulation and therefore gold and silver are widely traded in in the currency markets.

Trading on Gold and Silver is done electronically and bears the symbol of XAUUSD for Gold and XAGUSD for Silver. Both silver and gold are priced in U.S. dollars.

Trading the spot gold and spot silver is conducted over-the-counter with the prices fluctuating on a daily basis. There are many factors to consider when trading spot gold and spot silver and for the informed trader, this can mean making significant profits in the precious metals markets.

What influences the prices of gold and silver?

Before you begin to trade gold and silver you should first know what factors influence the price of the precious metal.

In the spot markets, gold and silver fluctuate largely for economic reasons. Gold and silver are considered to be a hedge against inflation. Thus, when inflation starts to rise, which erodes the purchasing power of the currency, gold and silver helps traders and investors protect their portfolios against a depreciating currency.

The precious metals are also susceptible to monetary policies such as interest rates and quantitative easing (money printing). During loose monetary policies, gold and silver tend to rise as a weaker currency and a slowing economy sends traders to invest in precious metals.

Here are some key economic reports that you should focus on when trading gold and silver.
  • Economic reports such as GDP, CPI, unemployment are important for gold and silver as it influences the U.S. dollar exchange rate
  • Interest rate decisions directly impact gold and silver prices as they move conversely to interest rates. Higher interest rates mean weaker gold and silver prices and vice-versa
  • Economic and geo-political uncertainty often sends gold and silver prices higher as they are considered to be a "safe-haven" asset.

Pricing Structure for Gold and Silver Trading

To be able to effectively trade gold and silver, you need to know the pricing structure.

Gold (XAUUSD) Pricing Structure
  • Gold is priced in U.S. dollars per ounce
  • The minimum tick size is $0.01
  • Each tick is priced at $1 for a standard lot
Silver (XAGUSD) Pricing Structure
  • Silver (XAGUSD) is priced in U.S. dollars per troy ounce
  • The minimum tick size is $0.01
  • The tick value is $50 for a standard lot

Gold and Silver Trading Hours

Name Symbol Open (GMT+13) Close (GMT+13) Break
Gold XAUUSD Monday 10:00 AM Saturday 10:00 AM 48 hours
Silver XAGUSD Monday 10:00 AM Saturday 10:00 AM 48 hours
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