An easy guide to learning the Olymp Trade Candlestick Strategy.
One of the most popular methods for investing on Olymp Trade is utilizing a Candlestick chart. Learning how to read these charts is a key component to applying the technical analysis you need to navigate potential trends on the market. These charts have strong indicators for learning to predict trends and reversals and track resistance and support levels accurately across many market situations.
Today, we have the opportunity to break down just what a Japanese candlestick chart is, how you can effectively use the Olymp Trade Candlestick Strategy, and a basis of some of the popular strategies people are using with this tool. Olymp Trade provides ample resources to continue your growth as a trader. Start your journey in the world of trading by exploring the platform.
What Exactly is a Candlestick Pattern?
This is a type of graph setting you can apply to the market trends of any given asset. Once the chart is set up, you will have two kinds of visual references. The first of the two will be green candles which represent growth on the market. The second of the two will be red candles, indicating a downward movement.
Regardless of its color, each candle will have two components to draw information from, a large bar and a thin bar. The thin bar runs through the center of the larger bar and shows its highest and lowest points reached throughout its creation. A thick bar surrounds the narrow bar and shows the total distance from its opening price to its closing price.
These candles intertwine across the chart and form patterns — each candle develops over a set period chosen by the person trading. As time moves towards the end of that period, the candlestick creates its permanent color on the chart. These patterns formed are the basis of trading with the Olymp Trade Candlestick Strategy.
Example:
If a trader sets the duration of their candlesticks to 5 minutes, and the asset has moved up in price at the end of this 5 minutes, the candle will be green. The opposite is equally true of the red candle.
You can see an example of a candlestick chart opened in an Olymp Trade window with its candlestick duration set to 1-minute intervals.
How to Set Up Japanese Candlesticks on Olymp Trade
Like any trade on the platform, selecting an asset is the first step to setting up a candlestick chart. Choose from the list of stocks, commodities, cryptocurrencies, or currency pairs. Once you have your asset in place, you must select the "Charts Type" button located in the bottom-left side corner of the window. Once the Japanese candlestick chart is assigned, a drop-down window will appear, and you select "Japanese Candlesticks."
You will see a similar chart appear across your window with patterns formulating. A button is referencing a time frame at the bottom center of the window. You can select this button by clicking directly on it and choosing from 15 seconds to as long as one month. There will also be a minus (-) sign to the left and a plus (+) sign on the right. These buttons will expand the pattern over more significant amounts of time or shorten the information window to its most recent candles.
You can see a chart on the Olymp Trade online trading platform with highlighted boxes and numbers notating each piece of important information needed for setting up the chart in your window. Below, we describe each of these key components.
How can I use candlesticks to earn profits?
- Select an asset and view it before deciding to trade on it.
- You need to select the "Charts Type" button to open a Japanese candlestick chart for the chosen asset.
- The "Duration" button controls the overall time when a candlestick is formed. You can zoom in and zoom out using the buttons that control the general period you are viewing in the window.
- This timer is a countdown; when it hits zero, the chart will have created the candlestick, and the next will begin to form at the beginning of the set duration.
Easily, the most important and practical question to ask is, "how does the Olymp Trade Candlestick Strategy make me money?" This question can be answered in various ways, as numerous tools allow the trader to conduct technical analysis of the charts. We will take the time to cover some of the most popular methods before you explore the many options afforded to you on the Olymp Trade platform.
Hammer indicators get their iconic name from their visual similarity to a real-life hammer. The thicker portion of the candle will be small and horizontally thin. This thicker candle will sit on top of its much longer vertical "wick." The narrower portion will always sit beneath the candle, not above, forming a hammer. When a hammer of either color appears in your chart, it is a strong indicator of a future reversal.
A Shooting Star is another strong indicator of a reversal trend, and they are visually the exact same as a hammer, only inverted into an upside-down position.
A Doji indicator is a trend candle that represents closing due to indecision. It is visually similar to a cross, with long wicks on both ends of a horizontally thin candle. It is best in this situation to refer to the closing price of the previous candle. Following a bearish closing point with a downward position and an upward position following a bullish candle.
These are just a few examples of simple indicators on a chart. These indicators can also build larger patterns that give vast amounts of information. Olymp Trade has an elegant and easy interface built into its help center that covers everything you could ever need to know about the different patterns that appear and their respective strategies.
Take a look at some of the strategies that are provided for you here.
Practice Makes Perfect
Candlestick pattern-based strategies are simple and easy to implement because the technical analysis needed is just waiting for a pattern or indicator to occur. At these points, you place an Up or Down trade above or below the candlestick formation, that way you enter the market when the trade commences.
While entering the market using the indicators and patterns provided to you in this article would itself be easy, successfully implementing these strategies on a consistent basis will require disciplined money management and a strong understanding of when to exit trades.
Luckily for you, Olymp Trade has created a perfect environment to implement these strategies yourself without the risk of losing your hard-earned money. A free demo account is available to all account holders. This demo acts just as a live market would with detailed and accurate feedback as if you were investing in real-time with your own money. This ability to gain experience and confidence is essential to Olymp Trade, giving each trader the optimal opportunity for success.
Take advantage of these opportunities to succeed today. If you haven’t already, download the app on your computer or cell phone. If you’re interested in making life-changing profits at Olymp Trade, try using the Olymp Trade Candlestick Strategies yourself by following the link here.
