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Solution: Trading Gold as a Forex Pair

2 weeks ago, I had dinner with my extended family.

Lo and behold, my brother-in-law tapped me on the shoulder and asked me the question all veteran traders dread: “How do I get started in the markets?”

And after chatting about his goals (he confessed an interest in Gold futures) and risk profile, I had to ask the slightly awkward question, “…and how much do you have to invest?”

The answer didn’t surprise me (not as a long-time trader, anyways.) – “somewhere between the $5,000 – $10,000 range.”

And I had to be the bearer of bad news… that trading some markets, like Gold futures, is simply too risky with a small account.

Maybe you’ve been in this spot before… maybe YOU’RE the brother-in-law in this situation.

Capital is a big deal and it can leave several eager investors on the sidelines.

Lucky for him, I came up with a great compromise. He was able to get into the Gold action and I got to keep my clean conscience that he wasn’t over leveraging himself.

Here’s my solution.

Gold Forex instead of Gold Futures.

Gold is a great trading commodity.  Many forex brokers offers ways to trade it as a currency vs other pairs.  The Gold/USD is one of those pairs and is a great trading market.  We are finding tremendous opportunities on many different timeframes.  Here’s an example of how one can trade gold with a 15 minute chart.  Forex offers some compelling reasons to go this way because of the great flexibility it affords the trader in regards to proper position size and risk management.

The Gold / USD forex pair rakes in +63 pips today using two positions, with our new 15 minute tradeplan.  It can be traded with one, two or three positions.



Gold futures require more capital due to margin requirements and contract specification.  Forex gold pairs give us the ability to trade with the size that is appropriate to our available trade capital.  Using the leverage that is offered by most brokers is fool hardy and leads to ultimate losses.  Winning tradeplans do have to trade through losing trades and losing sessions and yet the tradeplans produce winning results.  Risk management is critical.  Trend Jumper Members are taught how to figure out the proper risk so that they can continue to prosper, even through the inevitable losing trade that pops up from time to time.  This is one of the great benefits of forex and why one should consider trading such a dynamic pair as the gold / USD cross.


  1. Steve Brandt says:

    Sounds like a great way to trade gold. I’ve never heard of gold forex.
    I am currently setting up your ym jump trader on ninja and the audusd free systems that you have given for free. I would love to make the money to by into your trend jumper software and traderoom. I have a small account, mostly because I have lost a lot in the past and have never been profitable, so I keep it small so I can’t loose as much. Anyway thanks for the free software and we’ll see how it goes.
    Thanks Steve

    • Steve, keep in mind great training is also critical. A good strategy is only as good as the trader using it. Backtesting is critical to build belief and to reconfirm your knowledge of the strategy. If you can’t see the big picture, forest from the trees perspective, it is hard to succeed even with the best approach. Trend Jumper works great. It works even better with the training that goes with it.

  2. Jw wright says:

    Or trade GLD options on a 4HR time frame. Small risk good possibility
    of a favorable outcome

  3. Indeed, Forex is an alternative for the trader with small means.
    However, there is also another side to this coin : When trading Forex, you’ll get confronted with relatively very high costs per trade. It is a complete lie, when brokers ‘claim’ they do not have trading costs. No , they don’t, but their spread is ugly most of the time. Especially, when compared to the spread in futures.

    • You are correct that spreads are real costs. We have seen the spreads come way down though and there are good reputable brokers out there. Of course you have to shop around and go for the lowest spreads. Still though, there is enough profit on the Trend Jumper trades to account for those costs and the profits are there.

  4. herman says:

    l am not your brother in law but i am not as smart as he is, how do i start gold forex and what the hell is it.

    • Gold forex is trading the value of gold vs a currency. We like the gold vs the USD. It’s just like trading any other currency pair. The XAUUSD happens to trade very nicely on many different timeframes.

  5. Leonie says:

    Hi this looks very interesting and would like to know more about how it works, as with everything its about training and practice.

  6. John Churchill says:

    Would a Gold ETF have been a possible solution?

    • Yes indeed. We love Gold ETFs and Trend Jumper works great with them. Same with Silver, by the way, as well as many other ETFs.

  7. I have been burnt by the futures markets before as with not enough capital the movements against you can eat your capital quickly.
    As to your suggestion to trade the gold/FX crosses is a far better way to minimize risk and give a better opportunity to stay in the game longer.
    I now only concentrate on the FX market as the ability to trade micro or mini lots are a great advantage.

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