Does Gold Have Trading Hours?

Does Gold Have Trading Hours?

Reading time: 8 minutes

Steeped in a thoroughly historic market, gold has been traded across the globe since the start of civilisation. Its incredible heritage, beauty and enduring demand have built livelihoods all over the world as markets continue to be flush with traders of the precious metal. From flash jewellery to hardy investments in bullion, gold in the modern day is as sought after as it ever has been, if not more.

Its price, despite temporary dips, continues to show an upward curve (uptrend) over time as the metal becomes harder to mine and global uncertainty rears its head. Trading gold has become one of the most popular choices for new and existing traders due to its volatility and low barriers to entry, but are there certain times when gold cannot or should not be traded? When does Gold move the most? Let’s have a quick look.

Trading Hours and Holidays

Unlike stock trading, which, if we’re talking about physical share dealing, revolves around centralised markets (a centralised exchange), the precious metal markets provide several avenues to trade gold.  For example, you can trade COMEX gold futures contracts, which operate on a central exchange from Sunday to Friday (Chicago time) between 6 pm and 5 pm. You can also trade gold CFDs (Contracts for Differences) with FP Markets, which trade over the counter (OTC) and are largely open 24 hours daily.

So, whilst physical shares of BP can only be bought and sold during the opening times of the London Stock Exchange, a gold or currency trade benefits from overlapping global markets (overlapping trading sessions), meaning at any one point, there will always be at least one major (country) market open.

This means that gold is mostly available to trade nearly 24 hours a day, from Sunday afternoon to Friday, with no weekend trading. Unlike the OTC forex and gold CFD market, which runs fluidly 24 hours a day, the precious metals market has a one-hour break from midnight each night in the futures market. However, gold does adhere to normal holiday market closures.

The best time for trading gold revolves around market supply, demand and liquidity. From 07:00 to 17:00 GMT, the market is busy, liquidity is high, and thus trading can be more volatile. Many traders tend to take action in these hours.

Forex Market Hours

Forex, or the Foreign Exchange market, is easily the largest financial entity in the modern world. Because of this sheer velocity and thick coverage of the market, the forex market is fully operational 24 hours a day. Thanks to strong global connectedness and technological advancements, trading forex can be done throughout global markets.

The international scope of forex trading means demand is usually met for a particular currency trade. Gold is traded similarly because the pair XAU/USD is not listed to a specific exchange but rather refers to the spot price of Gold in terms of USD.

What Time Does XAU/USD Move the Most?

The spot price of gold is one of the most volatile financial instruments in existence. Despite this, gold trading has quiet periods. A professional gold trader will know when a good time to open and close a position will be.

The market price is similar to crude oil in that it is determined by economic security, typically the current state of political and economic affairs around the world. In times of distress and uncertainty, buyers increase as the steadfast value of gold acts as a hedge-like honeypot for nervous capital. Shifts in supply and demand in turn lead to price fluctuations, so it's important to keep in tune with the times of particular global affairs and financial news. Other than supply and demand, other price catalysts include inflation or greed and fear.

Historically, data shows that XAUUSD moves the most from 12 pm - 8 pm GMT, or around the open market in Eastern and Central USA. A high volume of trade equates to increased liquidity and thus more pressure on price action.

How To Trade Gold?

Like trading anything, there’s no set way to succeed. A professional trader will tell you that above all else, honing in on wider arching things like risk management, proper position sizing or trading psychology will be more applicable to long-term success. This is alongside a well-defined trading strategy.

There are, however, a few additional things that will help you trade gold. Stay ahead of the curve. Knowing the best time to trade based on certain political or economic events will mean better insight into supply and demand logistics.

Consider opening a demo account with FP Markets, a brokerage delivering superior trading conditions in the precious metals space. 

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