Jump to content

Hedging on gold


Guest Philly

Recommended Posts

I went long £50 per point on spot gold at 1302.

The margin is £640 and my balance is £1500.

Can I also go short on Gold (dec) £50 per point in the chance that the market moves the other way?

As my balance is on only £1500 it will be down to £840 once I place a short at £50pp.

Would the funds from the gaining position add to the available balance and stop my account from closing?

 

 

Link to comment
Guest Futures

Dont do that with gold unless you expect it to range what you will do overall is limiting your losses to the difference in your long and short and you will need to favor one position over another to make something out of it. or else it will display a const loss which doesn't make any sense. i tried and lost a lot in this confusion and got profitable only once when i predicted the direction and favored one position and closed the other before the other

Link to comment

Hi Futures, many thanks for the reply.

 

Please stay with me on this as I am very new and don't 100% understand the situation.

 

What about this scenario.

What if I did what I said above and opened a short, gold went down to 1200. 

My long position would mean I would be down £5100 but my short position would mean I would profit from £4000 if I went long at 1280.

Could I close my short position and take the £4000 profit and wait for gold to recover to 1300, assuming direction of course. 

 

I understand that whilst both positions are open I would not win or loose but what if I close when the time is right?

 

Would that work??

 

Again many thanks 

 

 

Kind regards 

Link to comment
Guest Futures

Technically what you are trying is possible but this is a losing game trust me once you close your short  your loss of long is £5100 and if gold goes down again you will be tempted to do another short that will increase your overall loss to £5100-£4000+ pips down from 1200 and you wil lose original context of what is happening with gold and wil worry about your orders only. Overall this needs perfect execution, entry exit. I did the same too one way profit on £50 per point in EURUSD and soon my losses exceeded from what i intended and i was hooked onto it. ultimately it reversed but nearing US election i wont recommend to try out new strategy. if you want to try out then sell less like £10 or £15 to limit some losses and ride it out if it goes all the way down but close you £50pp at some stop loss. thats what i would recommend.

Link to comment

Hi  

 

Funds are only available for other trades once position is closed,  is right, once there is discernable direction in favour, close out the opp trade, think to open a small hedge again in the opp direction once price threatens to turn again (as it will inevatably do) and look to increase hedge and decrease main bet if turn developes into real reversal.

PS I hope you are playing about on demo.

 

Listen to;

https://soundcloud.com/chat-with-traders/093-ben-blb_capital

 

from the list;

https://soundcloud.com/chat-with-traders

Link to comment
  • 9 months later...

Archived

This topic is now archived and is closed to further replies.

  • General Statistics

    • Total Topics
      21,632
    • Total Posts
      91,899
    • Total Members
      41,911
    • Most Online
      7,522
      10/06/21 10:53

    Newest Member
    PBEE
    Joined 25/03/23 10:02
  • Posts

    • Charting the Markets: 24 March The FTSE 100, DAX 40 and Nasdaq 100 slide on renewed banking woes while EUR/USD, EUR/GBP and GBP/USD drop as the US dollar, gold appreciate due to flight-to-quality flows. Crude oil and copper tumble on recession fears.  Axel Rudolph FSTA | Senior Financial Analyst, London | Publication date: Friday 24 March 2023         This is here for you to catch up but if you have any ideas on markets or events you want us to relay to the TV team we’re more than happy to.  
    • Market Breakdown | WTI Oil, EURUSD, GBPNZD, EURAUDHere are the updates & outlook for multiple instruments in my watchlist.1️⃣ WTI Oil daily time frame️The market is trading in a long term bearish trend .After the last sharp bearish movement, the market is steadily recovering.Ahead, I see a major horizontal supply area.Probabilities are high, that the next bearish wave will initiate from there.2️⃣ EURUSD daily time frameAfter a breakout of a solid daily resistance, the market is preparing for its retest.Watch carefully the underlined zone and look for buying opportunities from there.3️⃣ EURAUD weekly time frameThe pair is currently approaching a weekly horizontal resistance cluster.Taking into consideration, that the pair is quite overbought, probabilities will be high to see a pullback from that4️⃣ GBPNZD daily time frameThe pair is currently retesting a broken neckline of an ascending triangle . As we discussed earlier, the trend line of a triangle and its neckline compose a contracting buy zone now.Chances will be high that the next bullish wave will initiate quite soon.For Additional confirmation use: Divergence Indicators
    • #CHFJPY: Classic Bearish Setup 🇨🇭🇯🇵   🔻CHFJPY has nicely respected a confluence zone based on a horizontal 4H resistance and a 0.5 retracement of the last bearish impulse.   The price formed a double top pattern on that and broke its neckline.   Probabilities will be high that the pair will drop lower soon. Goals: 141.172 / 140.363  
×
×
  • Create New...