The reason for the surge in spot gold is revealed! How to avoid its impact?

In the spot gold trading market, there are often some sudden market conditions, such as a sudden surge in the market price, and many investors are caught off guard if they don't pay attention. Many investors want to know what is the reason for the surge in spot gold, and how can we effectively avoid its impact? Let's find out today.

What is the reason for the surge in spot gold?

In fact, there are many reasons for the surge in spot gold. Today we will talk about the two most common. First of all, it is well known that spot gold is priced in U.S. dollars. The fluctuation of the U.S. dollar affects the price of spot gold all the time. Once the U.S. dollar dives, it will basically lead to a surge in the price of spot gold. Another reason for the surge in spot gold is sudden geopolitical events. Because gold has the property of hedging risks, once a geopolitical event occurs and triggers a sharp rise in risk aversion in the market, the spot gold price is very likely to be in a short period of time. A surge occurred.

How to avoid the impact of gold price protection?

When the spot gold price suddenly fluctuates by a large margin, many investors who hold orders in the opposite direction of the market tend to suffer large losses. How can they avoid the negative impact of the large market price? In fact, the easiest and most direct way is to set a stop loss and control the trading position.

As long as investors do these two points well, they can basically control the risk well, but sometimes investors set stop losses but it is ineffective, because investors encounter the phenomenon of slippage. This is a phenomenon on the market price platform. The platform trades at the market price. Once a large market situation occurs, the transaction price may exceed the stop loss price, which makes investors lose the ability to control risks.

However, investors can choose a price limit platform for trading, because the price limit platform can ensure that the stop profit and stop loss are accurate and effective at any time, and it is a good helper for investors to avoid slippage and better protect their own interests.

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I believe everyone knows the reason for the surge in spot gold, and the negative impact it brings is what we often call the unknown risk of the market. If you want to avoid it, you can use a price limit platform, which not only makes the trading environment more stable, but also has higher risk control capabilities.