I know alot of traders trade gold depending on what stage another market, such as forex, is in. How exactly does trading gold work? When are the times you want to be long or short gold in relation to where the forex market is?
Gold and the metal commodities have been on a tear since last year. A great way to trade with gold and the other commodities are by buying/selling "commodity currencies" such as USDCAD, AUDUSD, and NZDUSD
On entry, there has to be a valid reason for buying at this time at this price. It's essential to know the earliest price at which this reason 'dies' - price will only be rising because more people are buying, and if you don't see a reason to buy more, probably nobody else does either. That's the level for you to get out.
It is hard to identify is the target price at which you would close the position and bank your profits. Ideally, this would be identified by your knowledge of how far price normally travels after the entry signal of the type you have used, whilst respecting other criteria to some degree, such as overbought indicators, resistance levels etc. My advice is make sure price has a high probability of making your target and always get out as soon as it gets there. If you must hold on for greater gains, though I don't recommend it, use a trailing stop.