Introduction

Trading London Gold (XAUUSD) with 60-minute candlestick charts has become increasingly popular among forex traders. The hourly charts offer a more detailed view of the gold market and can help traders make informed decisions. In this article, we will discuss how to use 60-minute candlestick charts to trade London gold.

Understanding 60-minute candlestick charts

Candlestick charts are a popular form of technical analysis used in forex trading. They are similar to bar charts in that they show the high, low, open, and close prices of an asset over a specific period. However, candlestick charts are more visually appealing and offer more information than bar charts.

A 60-minute candlestick chart, as the name suggests, shows the price action of an asset over 60 minutes. Each candle on the chart represents 60 minutes of trading, and the color of the candle depends on whether the price closed higher or lower than the opening price. A green or white candle indicates that the price closed higher than the opening price, while a red or black candle indicates that the price closed lower than the opening price.

Identifying trends

The first step in using 60-minute candlestick charts to trade London gold is to identify the trend. A trend is a general direction in which prices are moving. There are two types of trends: uptrend and downtrend.

To identify an uptrend, look for a series of higher highs and higher lows on the chart. Higher highs indicate that buyers are willing to pay higher prices, while higher lows suggest that sellers are not able to push prices lower. Conversely, to identify a downtrend, look for a series of lower highs and lower lows. Lower highs indicate that sellers are not willing to pay higher prices, while lower lows suggest that buyers are not able to push prices higher.

Using indicators

Indicators can be a useful tool in trading London gold using 60-minute candlestick charts. They help identify potential entry and exit points and can help confirm or negate the existence of a trend.

One popular indicator used in forex trading is the moving average. A moving average is a line that shows the average price of an asset over a specific period. It is calculated by adding the prices of an asset over the period and dividing the sum by the number of periods.

To use the moving average, look for a crossover. When the price crosses above the moving average, it is a bullish signal, indicating that buyers are in control. When the price crosses below the moving average, it is a bearish signal, indicating that sellers are in control.

Setting stop-loss and take-profit orders

Setting stop-loss and take-profit orders is crucial when trading London gold with 60-minute candlestick charts. A stop-loss order is an instruction to close a trade at a predetermined price to limit losses. A take-profit order is an instruction to close a trade at a predetermined price to lock in profits.

When setting stop-loss and take-profit orders, consider the size of your trading account, the amount of risk you are willing to take, and the current market conditions.

Conclusion

In conclusion, trading London gold with 60-minute candlestick charts can be a profitable and exciting experience for forex traders. By understanding candlestick charts, identifying trends, using indicators, and setting stop-loss and take-profit orders, traders can make informed decisions and minimize their risks.