Download AppDownload AppClose

Gold &Silver

Gold &Silver

Trading Gold with CMSTrader

Trade Gold and precious metals through CMSTrader.

CMSTrader allows you to trade gold and silver by using the CMSTrader platform. Many consider gold and silver to be the safest options, especially when the stock market goes down. You can access this market through our platforms. By  trading these goods and enhancing your investment by using leverage up to 1/50, you will be able to trade these goods with the lowest amount (up to 50 times the value of your account).

Advantages of trading Gold and Silver

  • Narrow margin (fixed-variable-ICN), as well as competitive prices, without commissions or any hidden fees

  • Gold and silver trading is considered to be a safe haven from the decline in stocks and commodities

  • Volatility of gold and silver on a daily basis provides you with many opportunities for trading

  • You’re in control the size of the profit and loss through the service (take-profit and stop-loss service)

  • Market is open 24/5, Sunday 22:00 - Friday 21:00 GMT

Trading Gold and silver with CMSTrader

Gold and silver trading is much like currency trading. The trader can take positions to buy or sell gold and silver and then take the opposite position on USD or other major currencies. Prices of gold and silver float freely on the basis of supply and demand in global trades. Spot price is the price offered for metal, which is a price you should pay ( delivery included) after two days of the actual deal (also known as a settlement date).

Trading can be done 24 hours a day, 5 days a week:  Sunday 22:00 GMT to Friday 10:00 GMT. There is no central market for gold and silver trading. However, the main centers for gold and silver are London, New York and Zürich.

Liquidity is considered to be at its best when the European market hours overlap with the New York market, almost four hours a day during mornings in the US. There are some periods of low liquidity in gold and silver near the end of the day for the  US market (22:00 – 23:00 GMT).

Why to trade in Gold and Silver?

There are many reasons to trade Gold and silver such as:

  • Speculation of prices is based on fundamental and technical analysis

  • Creation of balanced and varied distribution of assets create a more stable investment

  • Application of risk management as a hedge against market volatility, as well as financial crises caused by economic, social or political turmoil.

How to read the prices of Gold and silver

Reading the price of Gold and Silver is similar to reading Forex rates. For example, XAU/USD is representing Gold against US Dollar.

Let’s say that XAU/USD is 900.25: XAU refers to one ounce of gold and the value is always 1 ounce. Therefore, 1 ounce of Gold is worth $ 900.25. When price of Gold rises, the value of Gold is worth more than that of the dollar. Similarly, if the price falls, you will need fewer dollars to buy one ounce of Gold, which means that value of dollar rose compared to the value of gold.

Gold as a hedge against inflation

One of the most common description of gold and silver trading is a hedge against inflation. It means that with the decline of the purchasing power of currencies, gold is considered as a hedge against that decline. During the inflation, gold ensures that you will receive an amount of money proportionate to the amount of gold you have, regardless of what the inflation rate is.

Gold as an alternative to USD

Gold and silver are also used as a hedge against USD in the current economic environment Therefore, when USD is affected by negative pressure, investors seek other alternatives including gold and silver to secure the value of their investments.

Trading gold as a safe haven

Many traders believe that gold is the best option on the market. During times of volatility and high risk, investors are able to convert their investments to gold as a protection against uncertainty, which is an inherent and inevitable part of the industry.

Understanding economic and political factors

Economic indicators that have an impact on inflation include:  consumer prices, producer prices, as well as interest rate and treasury bond, these all play a significant role in finding the rate of inflation, thereby having an impact on price of gold. Macroeconomic indicators, such as unemployment rates and GDP, also highlight the strength of the economy, and may lead investors to invest in gold, depending on the data. The current economic environment has seen some significantly negative correlations between precious metal and weakness of the USD.

Political events can also have a major impact on the price of Gold. For example, If the uncertainty rose over the conflict in middle east, it may have an impact on the perceived safety of the investment in a country’s bonds or currency. Many investors transfer their money to gold as a way to avoid these risks. Gold can also be affected by oil prices, among other commodities, as the relationship between them play a role that affects the gold market. The rise in the price  of oil’s prices may cause  the price of gold to head in the same direction.

Trading Gold is usually volatile because the ability to enter and exit positions varies several times per minute. For this reason, prices may be more vulnerable to short-term fluctuations that do not necessarily follow a long-term trend.

Oil trading with CMSTrader

Oil is traded in contract with CMSTrader in the same way same as a currency pair, where the contract represents 100 barrel of oil, and prices are shown in USD. Oil contracts are CFD, and are a tool for trading with expiration dates that are then settled in cash.

Types of oil

CMSTrader provides two types of oil contracts, Brent (BCO/USD) and WTI. Crude oils are classified as either light or heavy, depending on the rate of API, as well as classified sweet or sour, which  depends on the level of sulfur in the oil. According to these classifications, Brent is “light sweet” or considered to be mixed, as it is collected from several oil fields in North Sea. The price of Brent is usually higher than the OPEC price. WTI is lighter and sweeter, and its prices are usually higher than that of Brent.

The reason to trade oil

Trading  petroleum products extends across many industries.s such, it is influenced by geopolitical factors, as well as commercial activities. This includes worldwide speculations from countries, large companies, and traders, as well as daily consumption of gasoline. Airliners may use the oil trade as a protective means against expected increase in oil companies attempting to take advantage of market  changes. Similar factors may affect the price of oil, as the ones that affect currency pairs as both are affected by similar forces. These forces can be political, financial or even the result of something seemingly trivial, like the weather.

How can I  derive prices of oil with CMSTrader

CMSTrader derives Brent BCO/USD and WTI prices on ICE prices. Our derived price represents the contract of current month in ICE, until the second Wednesday of each month, and between that date and the expiration date mentioned on the contract.

Supply and demand

Oil is considered to be a commodity with incredibly high demand. The largest consumer and importer of oil in the world is the United States, followed by China and Japan. Any event that disrupts oil supply can lead to a rise in its price, in addition to other factors, such as extreme weather, war, terrorism, political and decisions issued by OPEC.

Since oil is used in many industries and various products like gasoline, heating oil, fertilizers and cosmetics, the demand for these products has an impact on crude oil’s value. As the lack of demand on these products leads to a drop in demand for crude oil  prices will be negatively affected.

Inventory, sales data, as well as reports of EIA may also affect oil. In general, a trader can get access to these reports in order to reach a better understanding of the factors that affect oil consumption.

Seasonal factors

A seasonal consumption pattern can also have an impact on the price of crude oil. People consume higher amounts of petroleum products in colder months. In contrast, as onroad season in US leads to a rise in gasoline prices, in turn, demand might increase. The hurricane season in the Gulf Coast in the US, may have an impact on oil’s prices, because hurricanes are a threat to the refineries in the Gulf of Mexico. Traders should be aware of these patterns, and make decisions accordingly

Speculation

Speculation was recently under discussion among oil traders worldwide, due to the strong rise in prices during the summer of 2008, where the debate was centered on the role of speculators in determining oil prices. While speculators work to provide liquidity to the market, the fact that traders are not in need of the actual delivery of the commodity may have led to the dramatic movement of the price of oil all over the world. The deeper truth about speculators, is that their presence in the market may not be precisely linked to supply and demand, and therefore, the expected impact of supply and demand on prices, may not always be significant compared to the market sentiment about the direction of prices.

Currency

Because the price of oil is linked to the value of the US dollar, many of the factors that affect the dollar could also affect oil. Generally,  the direction of the price of oil is opposite of the direction of the USD’s value movement. A stronger USD, means that it will be more cost effective to buy a barrel of oil. Normally, this is great for consumers From this perspective, relations between currencies have an effect on the price of oil. If the price of a barrel of oil was at $100 a barrel, this will be good for producers (and bad for consumers). If the $100 is only 64 euros (weaker than the rate of the dollar), the high oil prices may not mean a lot to the producers, since their profits in dollars will not be valued at the same level.

 

 
 
EmailChatCallback