Trade Gold – the most demanded asset throughout the years

Profit from daily price changes when you trade gold and other commodities with OctaFX

Gold has always been a reliable investment when the markets or world politics are unstable. The total stock can’t be easily expanded, and unlike stocks, it’s not at risk of company collapse, so it’s often used as a bolster against inflation or currency instability.
Very popular now among online forex traders, gold can offer easy profits for low stakes, and makes a useful feature in a diversified portfolio thanks to strong trends and high volatility.

Why trade gold with OctaFX

  • No round-turn commissions
    Most brokers charge fees for entering the forex market, but at OctaFX you can forget about commission and focus on forex trading and making a profit.
  • Tight spreads
    We’ve minimised your trading costs, and we offer some of the lowest spreads in the forex industry.
  • All your favourite assets in one platform
    Choosing MetaTrader4 or MetaTrader5 allows you to trade commodities, indices and currencies using advanced charting tools and one-click trading.
  • Flexible leverage of up to 1:100
    Using leverage gives you much larger market exposure for a relatively small initial deposit. In other words, it amplifies return on your investment if you're of the right side of the trade.
  • Free market insights from our analysts
    Stay on top of the market with market news and analysis delivered straight to your forex trading platform or mobile phone.
  • Diversify your investments
    Gold is reliable, dependable asset with conveyable value, that is often used as a hedge against high inflation or periods of currency devaluation
The symbol for spot gold is XAU/USD
Trading Gold CFD can be profitable regardless of the market direction
You can trade Gold with OctaFX with spread from 0.8 pips and no swaps or commissions
The contract size for gold is 100 troy ounce.



Gold price In the end of 2017 — $1,302.50

What influences Gold price?

Gold’s stability as an investment can be traced back to its predictability. Although gold is found and mined every day, it’s in relatively small amounts, making it extremely unlikely that the market will be suddenly flooded. It’s also largely unaffected by local interest rates - indeed it has historically been used as insurance during times of fiscal instability.
When the world enters a lengthy period of upheaval, it’s easy to identify investors moving their money into gold, as demand and consequently price rises. Because it’s priced in US dollars, potential future inflation also drives the price up.
Measures of economic health such as GDP growth, interest rates, inflation and employment can all influence the value of gold on the Forex market, as can central bank monetary policy and the general flow of supply and demand. A sensible investor will take all of these factors into account when investing in gold.
Interest rate is the amount charged, expressed as a percentage of principal, by a lender to a borrower for the use of assets.
Inflation is the rate at which the general level of prices for goods and services is rising and, consequently, the purchasing power of currency is falling.
In other words, an economic growth is the increase in the inflation-adjusted market value of the goods and services produced by an economy over time. It is conventionally measured as the percent rate of increase in real gross domestic product, or real GDP.

What is the correlation between gold and the U.S. Dollar?

Wherever you are in the world, gold is traded using the US dollar as the benchmark. This creates a unique relationship between the currency and the commodity. Daily fluctuations in the dollar’s value will often feed through into the price of gold.
So how does change in the US currency’s value affect gold? The traditional way to explain this is that as the value of the dollar surges, the price of gold drops, and vice-versa. However it isn’t always that simple, and due to worldwide supply and demand among gold traders, sometimes both have risen hand in hand.
Between 1900 and 1971, the gold standard firmly linked the value of a single unit of a currency to an amount of gold. When that standard was abolished, that bond was broken, and could be valued purely on availability and requirement. This made the US dollar a fiat currency – a very popular reserve currency, and is traded on foreign markets. While the dollar is no longer a slave to the value of gold, the opposite still remains true, for a couple of reasons:
  • When the dollar falls, other currencies rise, increasing local demand and prices for commodities including gold.
  • Secondly, dollar investors start looking for more stable alternatives such as gold investment.
A commodity is a basic good used in commerce that is interchangeable with other commodities of the same type; commodities are most often used as inputs in the production of other goods or services.
Fiat money is a currency without intrinsic value established as money, controlled by government regulation, not physical commodity stocks.

So what scenario can cause both gold and the dollar to rise at the same time?

The main reason is usually instability somewhere else in the world, which causes foreign investors to look for the safest possible havens, often the US dollar and commodities including gold. The dollar’s value can be driven by any number of factors - inflation, monetary policy, foreign politics, trade - so its movements are often unpredictable even for experts.
One thing is certain though - the gold standard isn’t coming back any time soon, so the gold price will continue to be governed by the fortunes of the US dollar and worldwide demand for precious metals. This means that its future as a sanctuary for investors against falling currencies, chaotic markets and political and economic instability is all but assured.
Gold can be traded at OctaFX with 1:100 leverage and minimum volume of 0.01 lot.
There is no expiration date for CFDs — the position is closed when a reverse trade is made and at that moment profit or loss is calculated.
At OctaFX you can trade CFDs across several commodity markets, such as, metals, energies and indices
The most important trading venues for trading in gold are Zurich, London, New York and Hong Kong.
287 mln
The highest gold reserves are located in the USA (around 8.133 metric tons/287 million ounces)
The price of an ounce of gold hit an all-time record of $1,895 on September 5, 2011

Take advantage of the daily changes of the gold price

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