Spread and slippage in gold
Every gold trade pays two tolls: the spread you can see and the slippage you cannot. In quiet London hours both are tiny. Around a data release, at daily rollover or on the Sunday open, they multiply. Strategies that look profitable on clean backtests routinely die on these two costs, so it is worth knowing exactly when gold is expensive to trade.
Spread: the visible toll
Spread is the gap between bid and ask. In liquid hours gold spreads are typically a few tens of cents; that is the fee for instant execution. As a fraction of an average intraday swing it is small, which is why gold suits active trading at all.
When spread explodes
Three regular moments: the minutes around high-impact US news, the daily maintenance window when liquidity providers reset, and the Sunday reopen when the market prices a weekend of headlines at once. Spreads can widen many times over for seconds to minutes. A stop resting inside that widening can fill far from its level without any real move happening.
Slippage: the invisible toll
Slippage is the difference between the price you asked for and the price you got. Market orders in fast conditions slip in the direction against you; stops become market orders at the worst possible moment by definition. Averaging even a small slippage per trade materially changes the math of tight-stop strategies.
Keeping costs survivable
Practical rules: avoid entering in the two minutes around scheduled high-impact news unless the plan explicitly trades it; expect poor fills at rollover and Sunday open and size down or stand aside; prefer limit entries at pre-chosen levels over chasing with market orders; and when backtesting, charge every trade a realistic spread plus slippage before believing any result. Our own backtesting notes treat cost-free results as fiction.
FAQ
What is a normal XAUUSD spread?
In liquid hours, commonly a few tens of cents per ounce, varying by broker. Around major news it can widen to several dollars for a short time.
Why did my stop fill far from its price?
Stops become market orders when touched. If the book is thin or the spread has widened, the next available price can be well beyond your level.
How do I include costs in a backtest?
Charge each simulated trade the typical spread plus a realistic slippage estimate, and use worse assumptions for entries near news. If the edge disappears, it was never there.
Ready to see it live? Open the free XAUUSD live chart and try these ideas on real price.