Investments take on a range of forms depending on your intent for potential returns as well as risk aversion. While many people look towards safer investment options, others go into the international Forex Market to invest. Responsible for international currency trades as well as commodities like gold and silver, the Forex Market may be exactly what you are looking for. Open 24 hours a day during the week, the Forex Market has the largest asset class in the world, providing for a great deal of potential profit. At the same time, there is also the potential for risk.
To aid in reducing risk, a number of strategies are used by individuals and trading companies alike. Let’s take a moment to examine a couple well-known strategies under a new light. In particular, we will examine the London Hammer Trade technique in the context of online gold trading.
What Is The London Hammer Trade?
Simply put, the London Hammer Trade is named after the London market and it completely relates to the period of volatility that usually follows the market’s opening. As the London market sets the benchmark for international prices in these metals, it is the place to go for buying and selling when it comes to gold on the Forex. While the market opens in the middle of the night in North America, it opens during the day in Europe and the Middle East. This provides a huge window of opportunity to get the ball rolling.
Using The London Hammer Trade For Gold Trading
To make use of this strategy, you will have to see the chart as a candlestick chart instead of a price line chart. Making use of this strategy has everything to do with finding the resistance and support lines in the graph. If and when candlestick length surpasses a resistance, you should sell. In addition, if the candlestick has a tail that goes from the bottom of the candlestick downwards and passes the support, then you should sell as well.
When using this technique, you should place your order in a matter of seconds if possible, as the price will fluctuate dramatically at this point. In addition, while the chance of a high return is possible, there is also risk that should be attended to. As a result, consider getting a demo account and trying out your strategy and timing prior to actually putting money into the system.
How to Trade Gold?
Take advantage of the daily changes in the price of gold. Start trading gold today by opening a trading account with easyMarkets and get up to $2000 bonus*. As an industry first, they have also launched a unique deal cancellation tool as a way to manage your risk on any bad trades. By selecting dealCancellation on the trading platform whenever you make a trade, you can cancel your losing trade within 60 minutes and get your money back. *Terms and Conditions Apply
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