Economy
How to Trade Gold in Nigeria
Gold has traditionally been seen as a way to store your money. It’s not affected directly by either fiscal policy or monetary policy of governments and central banks like currencies.
It will always be worth something – unlike a currency that can end up being almost worthless as a result of rapid inflation, for instance. That’s why whether it’s in the uptrend or in the downtrend, the gold market offers high liquidity and excellent profit-making opportunities due to its unique position within the world’s economic and political systems.
Some traders often fail to take full advantage of the changes in gold prices because they haven’t learned its unique characteristics or the hidden pitfalls that can steal their profits. Let’s take a look at the advantages of trading gold, factors that can influence its prices and how to trade gold profitably.
What Drives Gold Prices
Like we’ve mentioned before, gold prices can be driven by a limited number of catalysts. Market sentiment, volume and trend intensity are generally driven by:
- Inflation and deflation
- Greed and fear
- Supply and demand
Market participants can face increased risk when they trade gold in reaction to one of these factors, when in fact, it’s another one driving price action. Imagine there’s a major selloff in the financial market, and gold starts rallying.
Traders assume that fear is moving the precious metal and expect that the emotional crowd will carry the price higher.
However, inflation may have actually triggered the stock’s decline, attracting a more technical crowd to the market that will sell aggressively.
Combinations of these forces are always in play in world markets, establishing long-term themes that track equally long uptrends and downtrends.
Gold attracts numerous crowds with diverse and often opposing interests. The so-called gold bugs (individuals who buy gold as protection against an anticipated collapse in the value of currency, stocks, etc.) stand at the top of the crowd, allocating an outsized portion of family assets to gold equities. They are long-term market players who are rarely discouraged by recurring downtrends, so they eventually shake out less ideological traders.
Gold bugs add massive liquidity, providing a continuous supply of buying interest at lower prices. They also serve the contrary purpose of providing efficient entry for short-sellers, especially in emotional markets when one of the three above-mentioned factors swings the market in favour of strong buying pressure.
To trade gold profitably, you need to know the crowd sentiment. Cayman Sentiment Index is a unique indicator offered by the AMarkets online broker absolutely for free to all of its clients that will allow you to spot potential market extremes, which can be considered as a strong signal for a correction or a trend reversal.
Examine long-term charts
Make sure to examine the gold chart carefully. Start with a long-term history that goes back at least 100 years. In addition to spotting trends that lasted for decades, you’ll see that the yellow metal has also trended lower for long periods of time, robbing profits from gold bugs. From a strategic standpoint, such an analysis is useful because it helps you identify price levels that need to be watched if and when gold decides to test them again.
Summing up
To trade the gold market profitably, make sure to study how the three polarities we mentioned in this article impact gold buying and selling decisions. Don’t forget to devote some time and analyze the long and short-term gold charts to see which key price levels may come into play.
Keep in mind that traders widely use gold as a “safe haven” asset. When market participants are worried about risk trends, they tend to flock to gold.
On the other hand, as risk appetite grows, expect a selloff in haven assets. As you can see, gold is an important hedge tool against inflation and a valuable asset that can bring you good profits.
If you consider trading gold, make sure you choose a reputable global broker with favourable trading conditions. AMarkets offers some of the lowest spreads in the industry to trade gold.
Just recently, it slashed its spreads on gold by 30% on ECN accounts, allowing its clients to make the most out of their gold trading.
By Adedapo Adesanya
The president of the Dangote Group, Mr Aliko Dangote, met with President Bola Tinubu on Monday to discuss and address concerns about the growing volatility in the global oil market and its impact on Nigerians.
Petrol prices have jumped to as high as N1,400 per litre amid the continuous rise in prices of crude oil in the global market as a result of the Middle East war. Brent crude rose above $100 per barrel due to compounding supply constraints, though it closed below the mark yesterday.
Mr Dangote, whose company controlled about 60 per cent of Nigeria’s domestic supply pre-war, speaking after the meeting, said that although Nigeria is not directly involved in the war, the ripple effects of global oil price fluctuations would inevitably be felt.
“It means quite a lot. We don’t have much to do with it, but I know the world is a global village. And it definitely will affect us, unfortunately, but we pray this situation will be sorted out,” he said after his visit to President Tinubu in Lagos yesterday.
He warned that a prolonged crisis could further destabilise economies, particularly in Africa, where fiscal buffers are limited, and debt pressures remain high.
“If it doesn’t de-escalate, we’ll end up paying high prices, like what I said earlier on CNN. Africa is very busy paying debt, and putting this again on top of us is going to add a lot of hardship on people, on the government, on the people, on everybody, for something that we have no involvement in.”
He stressed that energy costs are central to nearly all sectors of the economy, meaning sustained increases would have widespread and cascading effects on livelihoods and production.
He explained that governments could face mounting fiscal strain as subsidies rise and revenues fluctuate under unstable global oil market conditions.
Mr Dangote added that Africa’s rising debt burden could worsen under prolonged instability, further limiting fiscal space and weakening economic resilience.
“Africa is already grappling with debt, and additional shocks will only compound hardship for governments and the people,” he said.
He said escalating energy costs would disrupt nearly every sector, including small enterprises, manufacturing chains, logistics operations and household consumption patterns.
The business mogul noted that some countries were already adopting coping strategies such as reduced workdays, energy rationing and remote working arrangements.
Mr Dangote said such measures, while necessary, could reduce productivity, slow economic output and affect livelihoods, particularly among vulnerable populations.
He urged global leaders to prioritise de-escalation, stressing that many Africans rely on daily earnings and remain highly exposed to economic shocks.
By Aduragbemi Omiyale
A Community Development Service (CDS) group focused on investment education for corps members is to be established by the National Youth Service Corps (NYSC) in partnership with the Securities and Exchange Commission (SEC).
Both organisations recently sealed a Memorandum of Understanding (MoU) for this new initiative, which will promote sound investment habits among Nigerian youths, equip corps members with essential financial knowledge and help them avoid fraudulent schemes.
Under the agreement, the NYSC and SEC will work together on joint awareness campaigns, utilising various channels and platforms, including social media, traditional media, and community outreach, to disseminate information on safe investment and expose fraudulent schemes.
They will also agree on mechanisms for sharing relevant data and reporting on the progress and impact of the collaborative initiatives.
Specifically, the capital market regulator will develop and provide relevant and up-to-date educational content, materials, and training modules on capital market operations, safe investment practices, and the identification and avoidance of Ponzi schemes.
The agency will also be responsible for the content, resources and funding of training sessions for selected corps members and NYSC supervisors who will serve as trainers and facilitators in their respective communities.
On its part, the NYSC will facilitate the integration of anti-Ponzi scheme education into its Education and Enlightenment CDS programme, which could be through dedicated sessions, workshops, or awareness campaigns during orientation camps and throughout the service year.
The Director General of SEC, Mr Emomotimi Agama, expressed satisfaction with the collaboration, saying it will promote financial literacy and sound investment habits among young Nigerians.
His counterpart at the NYSC, Brig-Gen Olakunle Nafiu, lauded the initiative, stressing that it will help in enhancing public awareness campaigns against illegal financial schemes across all Local Government Areas in the country, among other objectives.
By Adedapo Adesanya
The NASD Over-the-Counter (OTC) Securities Exchange opened the week on a positive note after it appreciated by 0.84 per cent on Monday, March 23.
Trading activity returned yesterday after a two-day break last Thursday and Friday to celebrate the end of Ramadan.
The market capitalisation was up by N20.68 billion to N2.482 trillion from N2.461 trillion, and the NASD Unlisted Security Index (NSI) increased by 34.68 points to 4,149.38 points from 4,114.75 points.
The bourse was bullish amid a 1.34 per cent decline in the share price of Geo-Fluids Plc at the close of transactions. The loss was offset by the 3.45 per cent surge in the value of FrieslandCampina Wamco Plc.
A look at the trading data indicated that the activity was weaker yesterday, as the trading volume, value, and number of deals all tumbled.
There was a 99.9 per cent slip in the volume of securities to 412,260 units from the 400.8 million units recorded in the preceding session. The value of securities fell by 99.4 per cent to N7.37 million from N1.2 billion, and the number of deals went down by 31.9 per cent to 32 deals from 47 deals.
Central Securities Clearing System (CSCS) Plc ended the day as the most traded stock by value on a year-to-date basis with 38.7 million units sold for N2.4 billion. Infrastructure Guarantee Credit Plc followed with 400 million units valued at N1.2 billion, and Okitipupa Plc occupied the third spot with 6.4 million units traded for N1.2 billion.
Resourcery Plc closed the trading session as the most active by volume on a year-to-date basis with 1.1 billion units worth N415.7 million, trailed by Infrastructure Credit Plc with 400 million units transacted for N1.2 billion, and Geo-Fluids Plc with 131.1 million units exchanged for N505.6 million.
-
Feature/OPED6 years agoDavos was Different this year
-
Travel/Tourism10 years ago
Lagos Seals Western Lodge Hotel In Ikorodu
-
Showbiz3 years agoEstranged Lover Releases Videos of Empress Njamah Bathing
-
Banking8 years agoSort Codes of GTBank Branches in Nigeria
-
Economy3 years agoSubsidy Removal: CNG at N130 Per Litre Cheaper Than Petrol—IPMAN
-
Banking3 years agoSort Codes of UBA Branches in Nigeria
-
Banking3 years agoFirst Bank Announces Planned Downtime
-
Sports3 years agoHighest Paid Nigerian Footballer – How Much Do Nigerian Footballers Earn