Gold in thin Asia hours: limit or market orders?

[FXS London Scalper]

I've been trading a small gold strategy during late Asia (around 02:00–05:00 London time) and compared limit and market entries over two months, since the book is thin at that time.

Market entries (54 trades)

• Average spread at entry: 22 cents.
• Average entry slippage: −4 cents.
• Fill rate: 100%.

Limit entries (61 orders, 43 filled)

• Fill rate: 70%.
• No negative slippage (by definition).
• Of the 18 unfilled orders, 11 would have been winners.

The cost saving on limit orders was about 13 cents per trade (half spread plus slippage). But the missed winners mattered: roughly 11 lost wins against the savings on 43 trades.

Net result: market entries came out slightly better overall, because the setups that moved away fast without filling my limit were often the best ones.

My current compromise: a limit order placed one or two ticks inside the spread, with a 30-second expiry. If not filled, I either let it go or enter at market only if the setup is still valid.

Has anyone tested this on gold or other thin markets? I wonder if the result changes in London hours where the book is deeper.

[Shadow Trader]

XAUUSD trades around the clock, but the quality of the market varies sharply by session. In Asia, spreads are often wider and moves are driven by physical demand from China and India and by quiet positioning. In London and New York, a larger crowd of futures traders, funds and banks joins, and the character becomes faster and more volatile.

For a scalper, the main differences are cost and behaviour. A spread of 20 cents in Asia might be 10 in London. The average one-minute range is smaller in the quiet hours, so the cost relative to opportunity can be much worse.

Reaction to news also differs. A US data release hits gold hard during New York hours and comes through a much thinner market if the data lands outside them.

The COMEX open and the London gold fix times are known points where flows concentrate. Price often moves sharply around them.

Gold also has a habit of gapping at the open of futures trading and around the daily maintenance break on the exchange, which shows up as brief spread widening on spot feeds.

Applying one set of rules to gold across all sessions is asking for trouble. Many consistent gold scalpers pick one session and stay there.

Which session has worked best for gold, and what changed outside it?