SPREAD is a strategy in future market. There are two spreads: Inner Markret / Inter Market
Inner Market: Buy the GOLD FUTURE IN DEC and SELL GOLD FUTURE in Jan, or vice versa.
Inter Market: Buy the Gold and Sell Silver or Sell the gold and Buy the silver.
The beauty of this strategy is: You are safer for risky events such as FOMC Meeting. i.e. no matter what happens, gold and silver they will move together. and base on the location, I prefer to buy the gold and same time sell the silver for this FOMC meeting.
Komen
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This Strategy works so nice!
Now the GOLD SILVER Ratio is 72 EARN 400 pips
Komen
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Komen
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It's good to close this SPREAD trade with nice profit
How do you decide on the lot size to be traded? How do you make sure the ratio is correct?
tntsunrise
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@aloyghosal, VERY SIMPLE. MAKE SURE UR FACE VALUE IS THE SAME. I HAVE EXPLAINED IN MY VIDEO
gaptraderhq
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@tntsunrise ... Hi Jack, sorry I don't understand. Why buy Gold & then Sell sILVER??? They move together... So they move in different directions??? So you maybe in green with one but with the other you would be in the Red. Is this right? So are you then saying. Sell make profit... & wait for the one in red to correct??? Cheers
Very interesting Jack. May I ask how you manage these trades? Do you have targets and stops or do you play it by ear so to speak (cut the loser and let the winner run)? We all know there will be spikes. Often the first spike is a fakeout and the direction changes. I would find it very hard to time my exit. Can you elaborate a bit more? Many thanks.