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We are excited to officially inform our traders and partners that Exness has implemented a 20% reduction in our gold spreads, as of July 2024. This long-term adjustment marks a new milestone in our commitment to providing the best trading conditions for gold (XAUUSD) and other top asset pairs.

Lowest spread for gold trading

With this reduction, Exness now offers some of the best gold spreads available, outperforming the industry average by a significant margin. During high-impact news events, our XAUUSD spreads are 63% tighter than the industry standard, providing our clients with enhanced precision and reliability.

As market volatility increases, particularly in times of economic uncertainty, tight spreads are more attractive than ever for trading. Our recent reduction in gold trading spreads ensures that our clients can trade with lower costs, giving them a competitive edge in the market.

Five commonly used indicators for gold trading

XAUUSD’s low spreads have made gold one of the most popular assets in Exness, paralleling the financial world. Known for its stability and ability to act as a hedge against inflation and economic downturns, gold is the go-to asset for many traders. When forecasting gold, experienced traders often combine trading resources in a unique and personal way, but there are five top indicators considered to be foundational technical tools for gold analysis and forecasting.

  1. Moving Averages (MA), especially the 50-day and 200-day MA, are widely used to identify gold price trends. If the price of gold crosses above or below these moving averages, it often signals potential entry or exit points.
  2. Relative Strength Index (RSI) is quite an effective chart tool when determining whether gold is overbought or oversold. An RSI above 70 indicates that gold is ‘overbought’, while an RSI below 30 could suggest it’s ‘oversold’, giving gold traders an excellent entry point to consider and confirm.
  3. The Fibonacci Retracement tool is famously used by gold traders to identify potential support and resistance levels. Gold prices commonly form steep peaks and valleys on the charts and those reversal points often occur at the 61.8% level. The 50% and 61.8% also mark reversals but with less frequency than 61.8%.
  4. Bollinger Bands expand and contract based on market volatility. When the bands widen, it indicates increased volatility, and when they narrow, it suggests decreased volatility. Traders often use Bollinger Bands to confirm breakouts.
  5. MACD (Moving Average Convergence Divergence) is used to identify potential buy and sell signals based on the momentum of gold’s price movements. Crossovers of the MACD line and the signal line are common triggers for trades.

For a deeper understanding of trading indicators, check out this guide on Exness Insights.

Gold price movements and market behaviors

During times of economic uncertainty and geopolitical tensions, investors flock to gold, driving up its prices. Fortunately for you, our aim is always to be the broker with the lowest spread on gold. Monitoring news and charts constantly is a must to avoid bad entry points, but remember, the news reports what has already happened… not what is happening.

And as those news reports circulate, sentiment shifts again and a new price action or ‘reaction’ begins. If you trade based on media reports only, you’ll probably hit a few trends, but you’ll be late to the party most other times. As the old trading expression goes, ‘Buy the rumor, sell the news.’

Gold typically has an inverse relationship with the US dollar. When the dollar weakens, gold prices tend to rise, and vice versa. Monitoring the strength of the US dollar can provide insights into potential gold price movements. Gold tends to perform well in environments of rising inflation or when interest rates are low. This is because gold is often seen as a protective store of value.

Fed Chair Jerome Powel is truly stuck between a rock and a hard place. If the Fed doesn’t raise interest rates, the servicing cost of the US national debt will pass a staggering and unmanageable $1 trillion per year and eventually bankrupt the US Treasury.

If the Fed lowers interest rates, sentiment will shift quickly and global investors may drop US Bonds like a hot brick, which could either trigger a US inflation rise or a hard fall for USD. Having said that, markets are not behaving traditionally these days and such observation might be completely obsolete. The mechanics between inflation and interest rates have not been aligned with economic models since before the pandemic.

There’s more to suggest USD bondholders might mass migrate to gold soon. Gold prices are influenced by the physical supply and demand for gold. With the emergence of mBridge and BRICS, along with the rising repatriation of USD, it’s measurable how much the global demand for the greenback has drastically weakened over recent years. Many nations are openly trying to distance themselves from the US economy, and gold is the number-one ‘go-to’ asset for hedging economies.

Trade XAUUSD wisely

At Exness, we understand the importance of stability and transparency in trading. With the recent reduction in spreads on gold, trading this precious metal has become even more attractive. By understanding the key indicators, market behaviors, and strategies, you can take advantage of the opportunities that gold trading offers.

This reduction in gold spreads is part of our ongoing efforts to deliver exceptional value and ensure that our clients have the tools they need to succeed when trading XAUUSD and other popular assets.

We encourage all our traders to take advantage of these improved trading conditions and explore the opportunities that gold trading presents in today’s economic climate.

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