Gold is the most-traded metal on earth and a very different animal from EURUSD: bigger daily ranges, faster emotional moves, round-number magnetism. Here is how XAUUSD is built, what moves it, and how to size and risk it without surprises.
The contract, decoded
One standard lot (1.00) of XAUUSD controls 100 troy ounces. So a $1.00 move in the gold price moves your P&L by $100 per standard lot, $10 per mini (0.10), $1 per micro (0.01). Brokers quote two decimals (3,800.25) and most call a $0.10 move "one pip" — 3,800.00 → 3,800.10. Check your broker's specification: some call the $0.01 digit a "point" instead, and mixing the two up changes your stop math by 10×.
What actually moves gold
- Real interest rates. Gold pays no yield — when rate-cut expectations rise (check our FOMC dates), gold tends to catch a bid; hawkish surprises weigh on it.
- The US dollar. Gold is priced in USD, so it usually trades inverse to dollar strength. USD news is gold news.
- Risk sentiment. Geopolitical stress and equity fear push safe-haven flows into gold — often violently and with gaps.
- Central-bank buying. Multi-year official-sector demand has underpinned price through 2024–2026; it quiets the classic "rates up = gold down" logic.
How it behaves (and why beginners get hurt)
- The range is 10× forex. A quiet gold day can run $20–30 (200–300 "pips"); news days do $50+ with $2–5 wicks. Fixed 20-pip forex stops are instant donations here — size stops in gold's own units (use ATR).
- Round numbers are magnets. 3,800 / 3,850 / 3,900 attract orders and stop clusters. Expect pauses, fake-outs and fast slides once a big figure breaks.
- Spreads are wider. 20–35 cents typical on raw accounts (vs ~1 pip on EURUSD) — a real cost at scalping distances.
- London + New York hours carry the flow. Asian hours often range; the day's real move usually prints 08:00–17:00 UTC.
A sane way to approach it
- Trade the figures, not the noise: plan around round numbers and prior-day high/low; let wicks do the hunting.
- Size from the stop: decide the dollar risk first (1% rule — guide), measure your stop in dollars, then compute lots in the Position Size Calculator. Gold lots run small: $100 risk with a $3.00 stop ≈ 0.33 lots, not 1.00.
- Respect news: CPI, NFP and FOMC afternoons make gold jump $10–30 in a minute — either trade the reaction or stand aside; do not hold blind stops through the print.
- Demo first: gold's speed exposes every platform and sizing mistake at maximum cost. Test everything on demo — our library files included.
Frequently asked questions — Trading Gold
What is the pip value on XAUUSD?
With the common $0.10-pip convention: $1 per 0.01 lot (micro), $10 per 0.10, $100 per 1.00 lot — one pip equals a 10-cent price move. If your broker defines a pip as $0.01, every number divides by ten. The Pip Value Calculator handles XAUUSD directly. Need the same math automated? The XAUUSD pip calculator turns any stop distance and balance into an exact lot size.
How much capital do I need to trade gold?
About the risk budget, not the margin: at $100 risk and a $3.00 stop you trade ~0.33 lots. Start at 0.01 lots on demo until your numbers are second nature.
Is gold better for scalping or swing trading?
Its range favors intraday and short-swing styles, but the spread ($0.20–0.35) punishes tiny targets. Beginners: one planned move per session with 30+ pip stops beats thirty scalps.
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