How Does Gold Trading Work? Long, Short, Leverage & Hours

To trade gold you open a position on XAUUSD through a broker: buy ("go long") if you expect the price to rise, or sell ("go short") if you expect it to fall. Your profit or loss is the price change multiplied by your position size. Most retail traders use leveraged spot or CFD accounts, which means a small deposit controls a much larger amount of gold.

Going long and going short

• Long: buy 0.10 lots (10 oz) at 4,000 and sell at 4,020 — a $20 move × 10 oz = $200 profit.
• Short: sell 0.10 lots at 4,000 and buy back at 3,985 — a $15 drop × 10 oz = $150 profit. If price had risen instead, you'd lose.

Being able to short is a key difference from buying physical gold: you can aim to profit in falling markets too.

What a trade costs

• Spread: the gap between bid and ask. On gold it's usually small during London and New York hours and widens around news releases and at the daily rollover.
• Commission: some account types charge a fixed fee per lot instead of (or as well as) a wider spread.
• Swap (overnight financing): leveraged positions held past the daily rollover are charged — or occasionally paid — a financing amount. It adds up on trades held for weeks.

Leverage and margin

Leverage lets you control a large position with a smaller deposit, called margin. At 1:100 leverage, every $1 of margin controls $100 of gold. One standard lot of XAUUSD at $4,000 is $400,000 of gold, so it needs about $4,000 of margin at 1:100.

Leverage doesn't change how much you make or lose per dollar of price movement — position size does. What leverage changes is how big a position your account allows. If losses eat into your margin, the broker can issue a margin call or close positions automatically (a "stop-out"). That's why the next lesson starts from risk, not from leverage.

Order types you'll use

• Market order: buy or sell immediately at the current price.
• Limit order: buy below or sell above the current price — waits for a better price.
• Stop order: buy above or sell below the current price — used to enter breakouts.
• Stop-loss: closes a trade automatically at a set loss. Use one on every trade.
• Take-profit: closes a trade automatically at your target.

When gold trades

XAUUSD trades nearly 24 hours a day from Sunday 6:00 PM to Friday 5:00 PM New York time, with a one-hour break from 5:00 to 6:00 PM. The busiest period is the London–New York overlap, about 8:00 AM to 12:00 PM New York time. The live panel below shows what's open right now; the gold trading sessions clock has the full schedule in your time zone.

Choosing where to trade

Pick a broker regulated in your country, check its XAUUSD contract specifications (lot size, minimum lot, pip definition, margin), and compare total costs — spread plus commission plus swap — rather than the headline spread alone.