When Should You Buy Gold?
Gold, who doesn’t know him? Besides being commonly used as material for making jewelry, the precious metal is also used as a financial standard throughout the world. In the investment sector, gold is often considered a safe-haven asset, because it is proven to be able to anticipate inflation.
Investing in gold is tempting. The question: when should you buy or sell gold?
Before talking about the timing of gold transactions, you need to know 2 ways to invest in gold, namely:
- Buy and sell physical gold, in the form of gold bars or coins
- Online gold trading, buying and selling gold contracts through brokers
You are free to choose the way you like. But it’s good to know that the number 2 method provides some convenience for you. Among these conveniences are:
- You can make transactions from anywhere and at any time (24 hours a day, 5 days a week) because you only need a set of computers / smartphones connected to the internet.
- Don’t worry about the way and place to store gold, now you can store your gold online.
- low capital
Gold prices generally follow the global gold price of the New York Mercantile Exchange (the world’s largest gold commodity market) in the United States or London LOCO. Gold prices are listed in US dollars in “troy ounce” units. 1 troy ounce of gold is equivalent to 31.1 grams of gold.
To invest online, you need to know the following tips:
1. Use MetaTrader
MetaTrader is a trading platform in the form of a computer program that can help you monitor gold prices while transacting them online.
MetaTrader is very easy to use. This program can be installed (installed) on computers, laptops, even your smartphone , so it will be easier for you to monitor price movements and make online transactions anywhere.
You can get this program through our demo account registration.
2. Determine the “Support” and “Resistance” Levels
The “support” and “resistance” levels are the keys that can help you to determine the right time and price level in buying or selling gold.
In the support area, the price tends to rise again. In this area you should buy gold.
Resistance is the uppermost price level of a stock or index over a period of time. In this area, prices tend to move back down again. Well, in that area you should sell gold.
You can learn more about this “support” and “resistance” on our education page. On the education page, you can also learn other analytical tricks that you can use to trade gold. You only need to browse the available content starting from Beginner, Basic, Advanced to Advanced.
Following is the application of one of the strategies that you can use to trade gold online through the MetaTrader platform:
a. Run MetaTrader on your computer or laptop.
b. If you want to make a long-term transaction, you can click on the W1 (Weekly) timeframe that you can see in your MetaTrader.
c. Click the Line Chart option (you can also use candlesticks)
d. Then drag the line at points that can act as support and resistance.
Consider the following picture as an example:
Can you see the red lines on the green in the picture above? Well, the red lines are the support area, while the green lines are the resistance area. You can buy gold in the support area or sell gold when the price is in the resistance area (note the yellow area in the picture).
That’s the way. Easy, right?
Of course you have to adjust the amount of transactions you make with the capital you have. This is closely related to risk management and capital management, which you can also learn on our education page.
3. Make a Transaction Immediately!
After you know the right time to invest in gold, now you can start the transaction.
If you want to play physical gold, you need to think about how much money you need.
Based on the example above, you can see that the area of $ 1,200 per troy ounce is a good area to buy gold. Because 1 troy ounce = 31.1 grams, that means the price of gold per gram is 1200 divided by 31.1, which is around $ 38.58.
In online trading, the transaction unit is “LOT”, where 1 lot is equal to 100 troy ounces (3.11 kilograms). If you buy 1 lot of gold at a price of $ 1,200, your transaction is worth $ 120 thousand.
But calm down, because in online trading you don’t need to provide that much capital because of leverage. You only need to provide capital of $ 1,000 to make the transaction. No, you are not misreading. It’s only a thousand dollars! With a much smaller capital, you can get a profit with a percentage that is far greater than the initial capital.
To try an online gold transaction, you can immediately open a demo account. Or, if you are already interested in direct transactions, please open a real account now. education team is always ready to help you.