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Gold Starter Guide

What a beginner needs to follow gold news and read a gold chart, on one page.

1Three reasons gold is in the news

Rising prices. When the cost of living climbs, some people look to gold to hold its value over time.
Interest rates. Gold pays no interest, so changes in rates change how attractive it looks.
Uncertainty. Wars, elections and market shocks can send people toward safe havens. Central banks also buy gold for their reserves.

2Six words you will meet first

CandlestickOne bar on a chart showing the open, close, high and low price for a period.

TimeframeThe period each candle covers, such as one hour or one day.

SpreadThe small difference between the price to buy and the price to sell.

Stop lossAn instruction to close a trade at a level you choose, to limit a loss.

Take profitAn instruction to close a trade when the price reaches a level you choose.

LeverageOpening a position larger than the money you put down. It makes gains and losses bigger.

3How trading gold works

Many people trade gold through CFDs (contracts for difference). You trade on gold’s price moving up or down without owning any gold. You can buy if you think the price may rise, or sell if you think it may fall.

Leverage, for illustration only. Say your position is ten times the money you put down (your margin). If the gold price moves 1 percent against you, you lose 10 percent of that margin. A move in your favour works the same way. That is why leverage cuts both ways, and why losses can build quickly.

4Three habits before you start

Practise on a demo account first. Learn how orders work without real money at stake.
Decide where you would get out before you get in. Set your stop loss as part of the plan, not as an afterthought.
Only use money you can afford to lose. Never trade with money you need for bills, savings or emergencies.

5Your next step

Follow WCG for plain-English gold posts every weekday.
Have a question? Email support@wcggold.com.
Already practising on demo? Read From demo to live, with a plan.