Gold Hedging went wrong

Dear traders,

I got in to few sell positions of GOLD and realized its rallying up. Then I thought it could be short term so I let them be and opened buy positions thinking sort of a hedge. GOLD sell positions were swap paid ones so I wasn’t bothered a lot. Now my chart looks like below.

I got 0.29 lots of Sell mainly concentrated at around $1480

I got 0.29 lots of buys concentrated around $1730

What should I do ?

Lol you must feel like the market is against you. Its watching your every move and going opposite to your trades.

Do you have a strategy?
What’s your risk management?
How much % of your account are you trading with in each position?

Re-analyse the charts and decide would you buy, sell or leave alone. Then close the other positions and start again. Good luck.

What alarms me is your use of the word “hedging”. The big banks hedge, we don’t, we don’t have to, we can be in and out and in and out with everything we have in 5 seconds.

There are no safe havens. Gold is definitely not a safe haven for private retail traders (or investors).

I understand that very well. What do you think is the best to do here ?

I think @tradeforex077 put it as well as anyone could.

That’s right. I had no strategy, no risk management. I am working on those. Thanks for the advice :slight_smile:

If I were you I would have closed everything, accept the loss and don’t do it again.

If you start the game with closing one and leaving the other the chances are that you will end up in a worse situation.

Closing means taking responsibility, taking the initiative and that is that path to success

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Does hedging ever work?

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ofc it does. say u got in with the overall trend (up) on a pullback or breakout or whatever ur market aproach is. ur overall bias is to the upside, ur in profits, but price doesn t go up or down in a straight line. so when u anticipate a pullback u open a sell still keeping ur long open. when it finished retracing u closed the sell and keep the long. in case the sell isn t just a pullback and market looks like it wants to reverse completly then u keep the sell and get rid of the long. ofc this is in broad terms, and it implies u know when price it s most likely to pullback, or when wants to completly reverse. what tha t dude did isn t hedging at all. or u could hedge positions using corelation between currencies…again, it s a wide concept with lots of ins and outs, but if done properly, it could keepu into a position for months.

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If he doesn’t have the fullest appreciation of what hedging is - and isn’t - he shouldn’t be trying to pull off complex strategies like this.

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sadly most of the newbies do ■■■■ like that, when starting out, me included lol… u see something or read something, then u go on and start testing… sort of speak…and in my opinion are things like this that prolongue our learning curve cos we start out creating bad habits and chewing on misconceptions. by the time u start to learn a bit about the real market, u have to struggle now to unlearn all the crap and to get rid of the gambling mentality that comes with doing crap like this. this is 1 of the reasons that i don t believe in demos… even micro account is better then demo, cos it s always better and feels better to make a buck then to lose it. rant over :laughing:
cheers

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Sounds like you really didn’t have a solid plan. So that’s lesson #1.

Best thing to do is you sit down somewhere with beer or tea (whatever you like) and reflect upon this experience. How can you do better? How should you have traded this?

Been there, done that my friend. I was starting at -$50,000 loss before because I initially didn’t want to take a $100 loss. Thank goodness I closed the position before margin call. You better believe I learned a lot since!

Failure is a great teacher.

Close all your positions, you will pay swaps if you dont. Dont hedge, at least on the same pair its a stupid thing to do.

Are you not better just scalping?

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it depends on what u want to do, i do scalp and swing trade sometimes the hole week if the oportunity arises. lately i ve been gettin in on the 1hr chart cos i didn t wanted to just sit and monitor every 5m candle, spread of the candle, volume associated with it, the hole background, etc etc… it takes a bit of work to scalp consistently atleast in what i m concerned. but then again u can enter on 5 or 15m for a better price or and a tighter stop, bank some profit and set BE if the volatility is there, and just ride it out and manage it on 1hr chart etc…kinda what i do in order to try and maximise profits.
cheers

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True. Learn a style and perfect it.

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Thanks a lot longshottrader. I am still in Gold and was able to close half of the lots without going down from the balance.

Had 0.42 lots of Gold open, and the balance was 13500

Now its 0.22 lots with balance 13300

If the market continues to go up I can close the rest as well

Thanks for sharing your experience