Spread
Also called bid-ask spread. What it means, how it looks on a gold (XAUUSD) chart, and the mistake most traders make with it.
Spread: The spread is the difference between the buy (ask) and sell (bid) price. On gold it is a cost you pay on every trade and it widens around news and at the daily open.
Spread on a gold chart
With gold at $4,110.20 bid and $4,110.45 ask, the spread is $0.25, or $25 per standard lot. Around NFP it can briefly widen to $1 or more.
How traders use it
Traders avoid entering in the minute of a release and in the daily break (17:00–18:00 New York time), when spreads are widest.
Common mistake
Placing a tight stop just below a level without allowing for the spread; sell stops are triggered by the bid, buy stops by the ask.
Questions
What does spread mean in trading?
The spread is the difference between the buy (ask) and sell (bid) price. On gold it is a cost you pay on every trade and it widens around news and at the daily open.
How is spread used on gold (XAUUSD)?
Traders avoid entering in the minute of a release and in the daily break (17:00–18:00 New York time), when spreads are widest.
Educational content, not financial advice. Every concept here is a probability, not a guarantee.
Related terms
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