Gold trading is the most popular investment among Arab traders
The economic, social and political standing of gold in the world made it possess high liquidity that is not found in other markets. At a time when many around the world prefer the acquisition of the yellow metal in the form of alloys or jewelry, we see others tend to trade in gold through futures and options that offer high leverages that bring them a lot of profits and the risks of calculated and few risks. Today, trading gold depends on contracts for difference, where you can open a temporary position to buy or sell a specific amount of gold, and then determine the profit or loss account according to the change in the value of gold during the term of the contract.
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Gold is considered a safe haven for investors, especially in the period of economic fluctuations because it is one of the most important commodities that maintain its value. Traders around the world and even major companies are trading on this precious metal. Thus, we find that gold prices are always high and have an upward trend and it is very rare to be negatively affected by economic events like other financial sectors, and this has made gold among the most popular and most popular commodities in all local and global markets.
Gold is somewhat autonomous, but it is affected by some of the main factors:
Gold demand - the price of gold automatically increases with the increase in demand for it, and the amount of gold purchased has multiplied many times over the past four decades. The main reason for this is the financial and social value of the yellow metal in the world, in addition to being included in many industries such as technology.
The relationship with the dollar - this relationship is inverse in nature. The lower the value of the dollar, investors tend to buy gold as a safe haven and store value, and this helps to raise its prices. Also, the low dollar leads to an increase in the value of other currencies, which contributes to increasing the demand for gold.
Interest rates - interest rates are considered one of the most important factors that influence the movements of the gold price, as the relationship between gold and interest rates set by central banks is inverse. For example, if the Federal Reserve reduces interest rates, the price of gold will rise.
Global crises - After the global financial crisis that struck the markets in 2008, gold became an investment tool spread around the world and a safe haven popular with investors. This is because gold maintains its value in periods of uncertainty, economic uncertainty and political tensions.