When Not to Trade Gold Metal
There are times when you should not trade Gold because at this times the online Gold market becomes illiquid an unpredictable. Illiquid means there are fewer traders compared to other regular trading times. The times not to trade Gold are:
Scheduled economic data reports are released throughout many times of the month. This schedule can be found in advance on an Economic Calendar
There are 3 categories of economic news; yellow, orange and red, each category having a different impact on the price of Gold. High impact fundamental news can really move the prices of Gold, sometimes causing a spike in both directions, before price settling and moving towards one direction. These are high risk times where a lot of people get stopped out and it is best to avoid trading during these times.
However, it is not just the economic report announcements themselves that can affect the market prices. The sentiments and predictions of what the numbers will be can cause the Gold prices to move in anticipation of this data. It is therefore not a good idea to trade during the economic news reports time.
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Some major economic news like the NFP and Interest Rates decision can cause extreme volatility which is extremely hard to trade and can cause extreme movements in Gold metal markets within seconds.
Economic data can cause a lot of speculation and therefore a lot of price movement.
A lot can happen over the weekend leading to the market price opening with a large gap. This can cause a big difference in your trading account balance. It is therefore always best to close all your trades before the weekend and do not leave them open over the weekend.
Market Closing Times- NY closing
At the close time of New York trading session a number of trading positions are being closed or being swapped. This will lead to volatility in the prices of financial instruments and can cause the price to move erratically.
During the Asian market session financial transactions trade volumes are very low and the market moves in a trading range of about 20 to 30 pips and it becomes very hard to trade because the prices falls flat. It is best not to trade Gold at this time.
Do not trade Gold during Holidays. This is because the Banks are closed and therefore less participants in the online financial markets. If banks close for a holiday then the volume of financial transactions carried out is greatly reduced. This can lead to low volatility.
Holidays like Christmas and New Year, Gold traders should not trade on these days and should take time off during this week of Christmas up to New Year, date 2 when banks resume their operations. An Economic Calendar will include a schedule of bank holidays and Gold traders can keep updated.