Trading Essentials
Understanding the concept of gold trading in the Forex market
7 min read

There is no doubt that gold has always been a commodity that has always attracted attention from ancient times until now. Obviously, many households will tend to store gold in the house to increase the value of their assets. In the era of technological development, there are many ways to invest in gold to earn extra money. As a consequence, gold trading can be considered the most popular form.

So what is gold trading? What is the difference between online gold trading and buying real gold outside? Let's find out through this article!

What is gold trading?

Gold trading is a way for speculators to speculate prices on the Forex market. In other words, gold trading is the way that traders buy and sell gold’s price through reputable Forex brokers.

Unlike buying gold outside with many different risks, gold trading will be done through derivative contracts. On the other hand, the international currency code for gold in the Forex market is XAU. Not only that, it is also traded together with the US dollar. Therefore, traders will trade with the XAU/USD currency pair. In which, traders will put real money into online accounts, and analyze the market to find trading opportunities in that currency pair.

If finding trading opportunities manually in the Forex market is too difficult, you can refer to how to create a Forex robot to automate the trading process.

The difference between gold trading and gold investment:

Gold trading and physical gold investment have some differences as follows:

  • Gold trading is done on the Forex market through derivative contracts while physical gold investment is buying real gold at stores.

  • Gold trading can provide higher profits but also higher risks due to its speculative nature. Physical gold investment has higher liquidity and lower risks.

  • With gold trading, you only need to put in a smaller amount of capital to open a trade. For physical gold investment, you have to put in a larger amount of money to buy real gold.

  • Gold trading is done online while physical gold investment has to buy at stores.

If you want to profit from speculation and accept higher risks, gold trading will be a good choice. On the contrary, if you want to invest in gold for the long term with lower risks, physical gold investment will be more suitable. In addition, if you want to directly own gold, physical gold investment will be the most suitable form.

In short, each form has its own advantages and disadvantages. The best way is that you need to analyze in detail to choose a suitable form for your goals and needs. In addition, you can fully learn how to plan before participating in the Forex market to trade gold.

Reputable Forex brokers to trade the gold

Participating in gold trading is extremely easy, but choosing a reputable and suitable broker is a massive challenge. In fact, brokers appear everywhere in the Forex market. At the same time, each broker will have different characteristics and features. Not only that, you will encounter unreliable brokers if you do not do thorough research. Therefore, you can refer to the following brokers:

XTB Broker

No need to discuss the popularity of the XTB brokers, when most traders in the market know this broker. XTB is one of the world's leading brokers for trading digital currencies and stocks. XTB broker provides a range of trading services for individual and institutional investors including CFDs and digital currencies.

Not only that, the XTB broker is also known for the gold currency pair on the exchange. With constantly updated exchange rates and low trading costs, XTB broker is considered one of the most reputable gold trading brokers for small investors. In addition, XTB broker also provides many gold currency pairs for investors to choose such as XAU/USD (Gold/USD), XAU/EUR (Gold/EUR), XAU/GBP (Gold/GBP):

FXTM Broker

FXTM broker, also known as Forex Time, is also one of the world's leading brokers. This broker also provides more than 60 different currency pairs and 180 different stocks. To be more precise, these XAU pairs on FXTM broker should be mentioned: XAU/USD, XAU/EUR and XAU/GBP.

IronFX Broker

IronFX broker is also one of the world's largest currency and gold brokers. Specifically, IronFX broker provides more than 300 currency pairs and more than 50 types of cryptocurrencies. In addition, the IronFX broker also provides gold currency pairs such as XAU/USD, XAU/EUR and XAU/GBP for investors. At the same time, the IronFX broker also provides trading features such as advanced trading charts, instant execution, low spreads, etc. to help investors trade gold more effectively. 

With many different features and tools, this broker will help investors participate in gold trading more effectively. However, you should still research carefully and choose the broker that best suits your needs and abilities.

XM Broker

In the Forex market, the XM broker is also one of the most popular and reputable brokers in the world. Specifically, XM broker provides more than 55 currency pairs including gold currency pairs such as XAU/USD, XAU/EUR and XAU/GBP for investors. With low trading costs, constantly updated exchange rates and high security, traders can trade gold on XM broker with confidence. In addition, the XM broker also provides many useful features for investors such as market reports, the latest gold news, and gold price charts, ...

Effective gold trading methods

Although the ultimate goal of trading gold is to generate additional income, you also need to choose the right form and trading method to trade effectively. Therefore, the following methods can be useful for gold traders:

Trade gold on a demo or cent account before live

Besides gold trading, Forex trading, in general, should be tested on demo accounts first before going live. In other words, if you do not want to burn your account quickly, you should test your strategies on a demo or cent account. However, the market conditions on demo or cent accounts will differ from live accounts, so actual performance will only be about 80%.

Choose a trading style that suits your strategy

To develop an appropriate strategy for trading gold, traders should determine the investment form right from the start. On the Forex market, there are 3 popular investment forms that traders should consider:

  • Short-term or swing trading: trading gold Forex or gold CFD.

  • Long-term investing: buying physical gold from stores.

  • Inexperienced and time-consuming investing: Gold ETF funds.

Always update events that affect gold prices

There are many factors that affect gold prices, so you need to constantly update news and information when trading gold. In fact, gold is a representative symbol of the economies of countries around the world. Factors such as inflation or economic recession will directly affect gold prices. Therefore, if you always follow gold currency news, you will catch great opportunities in gold trading.

Capture the best time to trade the gold

Perhaps many traders have overlooked monitoring the ideal time frame to trade gold. Although there is no fixed time frame for trading gold perfectly, it will help traders determine price trends.

According to Vietnam time, from 7 pm to 2 am will be the ideal time frame to trade gold and predict gold price fluctuations in the market, because this is the most volatile time for gold.

If you want to find more effective trading methods, you can read these Forex trading tips.


If you want to speculate and hold gold in your hands, you can buy gold at stores. On the contrary, if you want to make a quick profit and be willing to take a high risk, you can do gold trading online on the Forex market. In fact, gold trading is currently popular with many Forex traders because it can generate quick profits. Therefore, you should learn and participate in gold trading to grasp trends in this market.