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EMA and SMA are the two types of moving averages used most in trading. Today,Howtotrade blogwill help you get acquainted with the EMA indicator. We will guide you on how to use EMA like professional traders. This is an important skill you need to have when trading using moving averages. Stay tuned to learn more about this EMA.
Video on using the EMA indicator in Binary Options trading
What is the EMA indicator?
EMA stands for Exponential Moving Average which is understood as exponential average. Unlike the simple moving average (SMA), EMA uses an exponential formula for calculation. So, EMA has better sensitivity and reacts to price faster than SMA. Professional traders often use EMA to predict price movements in the short to medium term.
What is EMA indicator?
Compared to SMA, EMA tracks price trends better. It catches up with fluctuations faster. However, for this reason, EMA also filters out noisy signals worse than the SMA.
How EMA works
Like other moving averages, the basic signals that the EMA gives to traders are trend signals.
Specifically:
+ When the price is in an uptrend, the Japanese candlesticks are above the EMA which is pointing up.
+ When the price is in a downtrend, the Japanese candlesticks are below the EMA which is heading down.
How the EMA indicator works
Especially:When the price crosses EMA decisively, it will create a new trend. This is an important price trend reversal signal of the EMA.
How to use EMA in Binary Options trading
There are many ways to use EMA to find entry points in options trading. A common use is to use EMA to identify the main trend and then wait for entry signals from the indicators or price behavior.
EMA combines with Heiken Ashi candlestick chart
The Heiken Ashi candlestick chart is a reliable tool for trading following the trend. Combining EMA with Heiken Ashi candles increases trading accuracy.
Conditions:The 5-minute Heiken Ashi candlestick chart. The EMA30 indicator. Open orders with an expiration time of 15 minutes or above.
How to open an order
+ Open anUPorder when Heiken Ashi candlesticks penetrate EMA from below.
+ Open aDOWNorder when Heiken Ashi candlesticks penetrate EMA from above.
EMA combines with Heiken Ashi candlestick chart
EMA combines with reversal candlestick patterns
With this strategy, EMA30 will be the dominant trend indicator. We will open orders in continuation of the trend with the signal ofcandlestick pattern signalingthe continuation of a trend.
Conditions:A 5-minute Japanese candlestick chart. The EMA30. Open orders with an expiration time of 5 – 10 minutes.
How to open an order
+ Open anUPorder when the price is in anuptrend. The price hits EMA and forms abullishreversal candlestick pattern (Bullish Harami, Three White Soldiers, Three Inside Up, Morning Star, etc.).
The EMA indicator combines with reversal candlestick patterns
+ Open aDOWNorder when the price is in adowntrend. The price hits EMA and forms abearishreversal candlestick pattern (Evening Star, Bearish Engulfing, Bearish Pin Bar, etc.).
EMA combines with reversal candlestick patterns
There will be many trading strategies as well as notes on how to use EMA in trading that we will present in the following articles. For now, open a DEMO account for yourself and practice to get to know the EMA. Goodbye and good luck.
For professional traders in Binary Options, a Fibonacci indicator is a powerful tool in predicting price reversal points. Today’s article will give you everything around this indicator. How to use it in trading with the highest efficiency.
A detailed video on how to use the Fibonacci indicator
What is a Fibonacci indicator?
A Fibonacci indicator is a technical analysis indicator. It is based on the nature of the Fibonacci sequence to identify special price zones of the market.
Fibonacci is a sequence of natural numbers arranged from left to right with a specified property. After the first 2 numbers, the 3rd numeric value in the sequence is the sum of the 2 consecutive numbers ahead. For example,
0, 1, 1, 2, 3, 5, 8, 13, 21, 34, 55, 89, 144, 233, 377, and next digits are 610, etc.
Morphologically, on price charts, Fibonacci is a series of horizontal lines that correspond to price levels such as Resistance or Support. This indicator helps traders to identify special price zones, thereby making predictions about the market in the medium and long term.
What is a Fibonacci indicator?
Common usage of the Fibonacci indicator
Traders always use Fibonacci two main uses:
To identify price reversal levels (Resistance/Support)
This is the basic use of Fibonacci in trading. You just need to put Fibonacci on the top and bottom of a market segment. Then, the resistance and support levels of the price will appear.
Fibonacci also helps traders determine if the price is in a trend or not. The signal here is that the price creates troughs and peaks at special price zones that Fibonacci displays.
To determine price trends
Trade Binary Options effectively with the Fibonacci indicator
There are 2 most successful strategies to trade BO using the Fibonacci indicator.
Basically, we are going to use Fibonacci to determine a trend. And then, we will look for entry points with another reliable price signal.
Strategy 1: Fibonacci combines with reversal candlestick patterns
The reversal candlestick patterns appearing at levels will be ideal signals for you to open a safe order.
Conditions:A 5-minute Japanese candlestick chart. The Fibonacci indicator. The expiration time is 15 minutes.
How to open an order
+ Open anUPorder when the price is in anuptrend and bullish reversal candlestick patterns appear (Bullish Harami, Bullish Engulfing, etc.) at the Fibonacci support zone.
Fibonacci combines with reversal candlestick patterns
+ Open aDOWNorder when the price is in adowntrend and bearish reversal candlestick patterns appear (Bearish Harami, Evening Star, Bearish Engulfing, etc.) at the Fibonacci resistance zone.
Fibonacci combines with reversal candlestick patterns
Strategy 2: Fibonacci combines with SMA30
This is a strategy to combine 2 trend identification indicators to increase entry reliability. Specifically, we will look for entry points when the price reacts to the SMA30.
Conditions:A 5-minute Japanese candlestick chart. The Fibonacci indicator, the SMA30. Open orders with an expiration time of 15 minutes.
How to open an order
+ Open anUPorder when the price creates agreencandlestick penetrating the SMA30 from below at the support created by Fibonacci.
Fibonacci combines with SMA30
+ Open aDOWNorder when the price creates aredcandlestick penetrating the SMA30 from above at the resistance created by Fibonacci.
Fibonacci combines with SMA30
This is a tutorial on how to use Fibonacci indicators effectively in Binary Options trading by How to trade blog. Please leave all questions as well as your sharing. Best regards!
“You can only make money in Olymp Trade when your account has money left”
I shared the Olymp Trade trading strategy which is “Trend + Signal” in the 20-article series making money in Olymp Trade. And today, in this article, I will write about how to protect the money in your account, so that you can survive in the market from year to year.
Today, I continue to focus on: Why can’t we lose money? And I’ll share my own experience for protecting money in Olymp Trade trading.
Before going into the article, as usual, I will withdraw money from Olymp Trade to the ACB bank.
Last week, I withdrew money 2 times from my Olymp Trade account to ACB bank. So in total, I only make $100 per week.
Withdrawal history in Olymp Trade
Video on the process of placing 3 UP Forex orders in an uptrend
Why is protecting money so important?
Who doesn’t know money is important? Money is your sweat, your effort. Money is not easy to make. That’s why it’s important. But no, I don’t want to talk about that. In trading, money is more important than that.
Opportunity is only for those who have money
The world has changed dramatically. And it only takes 1 night for the market to turn traders into millionaires. You and me, we all have that opportunity. The problem is: Do we have any money left? It might sound crazy, but I’m going to tell you some of the opportunities that have spawned so many millionaires in the marketplace.
In the first year of Covid (2020), things become unsettled. The number of infected cases continues to increase. There are more and more unemployment, riots, economic downturn, etc., and of course, this is a great opportunity to make money. When the FED continuously prints out trillions of dollars to save the US economy, every trader understands that: The USD will then depreciate against gold and other currencies. This means: Gold, EUR, etc. will continuously increase in price. But, only a very few make money. The reason is simple: They have money.
Opportunity is only for those who have money
Above is a chart of gold prices. It takes less than 48 hours, the gold price increased from $1900 to $1980. In one of its historic moments, gold rose over $1,900 per ounce, hitting an all-time high.
Such opportunities always repeat in financial markets. The oil price fell below 0 USD per barrel for the first time in history (-40 USD per barrel). Gold prices exceed all-time peaks and continue to rise. These are great opportunities for you to change your life or get back all the things you have lost in the past. But, most importantly, you have money left.
We are engaged in a long war
On the battlefield, guns and bullets are weapons. If you run out of ammo, you will die. In the market, the same goes for money. Running out of money means game over.
Do you want to get rich from Olymp Trade trading? I definitely believe it is yes. But both you and me, we can’t get rich fast without opportunities. However, as I said: Everything (strategies, skills, mentality, and opportunities) will be meaningless if you… don’t have any money left. So before you get rich from trading, try to survive. Opportunities will surely come.
We are engaged in a long war
During the long journey of joining Olymp Trade, you may have only traded and cut losses. It’s okay, it’s important that you have money. Because once the opportunity comes, you just need to get it right. You will get back all that you have lost or even more.
Every platform is designed to make you lose money
Not only Olymp Trade, I believe all platforms are designed to make you lose money. It is like a sophisticated trap used to catch “asses” like you or me. Do you notice that most platforms come with a stand-out Deposit button? There are technical indicators, Japanese candlestick charts, entry buttons, etc. They are all purposefully designed to stimulate you to trade. It turns you into “addicts” who never stop. It is annoying, itching, and makes you want to act, to open orders, etc.
Therefore, it is you, only you who can protect your money. You are not only against the “gravity” from the market but also against the temptation of the platforms. And now I will guide in detail how you can protect your Olymp Trade account as well as your own money.
How to protect money in Olymp Trade trading
Strategy 1: Do nothing
“Money is made by sitting, not trading” – Jesse Livermore (The greatest speculator of the 20th century). Do you understand what this statement means? – We earn money while waiting, not trading.
All professional predators “do nothing”. For crocodiles, lions … or professional killers, most of the time, they “do nothing”. They stay silent, meticulously observing with a cool mind. And when the opportunity comes, gnat attack! In only one shot, the prey is almost motionless. This is the nature of predators.
The power of doing nothing
So is the market. If you are not a predator, you are definitely prey. You need to train and equip yourself to become a hunter. Or you prepare a lot of money to turn yourself into prey. Do not worry! Even if your money is as much as a mountain, the market will take all from you.
Experience in Olymp Trade in doing nothing
Use a DEMO account and place pending orders. This is how you “bombard” the market. You will place pending orders with money in the Olymp Trade DEMO account. And when these pending orders match, you will come back and focus on the market. For example,
With the EUR/USD pair, looking at the Japanese candlestick chart at this time, you will see 2 levels: The support is at 1.17000 and the resistance is at 1.17425.
Experience in Olymp Trade trading
You will set up 2 pending orders with money in your DEMO account at these 2 levels: 1 DOWN order when the price touches 1.16970 and 1 UP order when the price touches 1.17440.
Experience in Olymp Trade trading
These two pending orders will act as signals to let you know: The EUR/USD has the ability to break out, opening a new trend. At this time, you “do nothing”. As long as 1 out of the 2 orders “explode”, your transaction is successful. This is when you come back, turn on your real money account and prepare to open an order.
Strategy 2: Smarter trading
Experience is one of the great factors for making money in the market. It is from trading with a demo account in Olymp Trade, or trade and lose money on real accounts. You will slowly form great experiences.
Always do market exploration
“Never test the depth of a river with both feet.” Because if you’re wrong, you die.
Smarter trading in Olymp Trade
Olymp Trade offers 2 mechanisms for you to trade: (i) Fixed Time Trade and (ii) Forex. And before you start, you need to open a Forex order to explore. Explore to make sure: You have correctly identified the trend of the market.
If you identify it correctly, your Forex order is sure to be profitable. The market is on track with the trend you predicted. It is entirely possible to open more Forex or Fixed Time Trade orders following that trend.
If you are wrong, you can cut the losses. Remember, Forex offers stop-loss while Fixed Time Trade does not.
Make the most of the trend
Identifying the trend is not difficult. It is not difficult to wait for reliable entry signals. I wrote in great detail in these 2 articles:
And when you are correct in identifying the trend, make the most of it by concentrating trading on that trend.
Make the most of the trend
For example, The price breaks out of the resistance zone and goes up, forming an UP trend. You can open 1 UP Forex order. During an uptrend, the market will give you signals to open orders. You can keep opening Forex orders to take advantage of the trend. This will help you increase your profits.
There are too many people teaching you how to make money, how to trade Forex, Fixed Time in Olymp Trade. But no one teaches you how to keep the money. But I, in this series, have repeated this twice. It is to emphasize to you that: Keeping money is more important than making money.
When the market does not give you a safe entry signal, it’s best to sit still and observe more. Opportunities will come. The problem is if we have money left or not. Hopefully, in the 20-article series of making money from Olymp Trade, I will comply with my principles. I will keep money, keep capital, wait for big battles with the opportunities to x2, x3, or even x4 my account.
Most of the knowledge for trading and making money in Olymp Trade in this series follow 1 strategy: Trend + Signal (Trends combine with signals). But what we have shared is about Uptrend and Downtrend. And in this post, I will write about the sideways market: Why shouldn’t we trade in Olymp Trade when the market goes sideways? So what are we going to do?
You can multiply the investment by 4 times with 1 Forex order. This is the most powerful advantage when you correctly identify the UP trend of the market.
Trade Forex in Olymp Trade
Sideway definitions
Sideway is not trending
Sideway is the term used to refer to a sideways market. In other words, when there is no clear trend in the market, it is called sideways.
Why does the market go sideways?
Answers: Very simply, after an UP or DOWN trend, the market needs a break to recover. This deems to be the resting period of the market. At this time, the price will move sideways within certain amplitude.
Why does the market go sideways?
Signals of a sideways market
When the market is not in a downtrend or an uptrend, it goes sideways. There are some signs of a sideways market including:
(i) The price creates peaks and troughs equal to the previous ones.
Signals of a sideways market
(ii) The price creates the following troughs higher than the previous troughs but the following peaks equal to the previous peaks. This is not an uptrend. It just makes us feel like the market is bullish. But indeed, it’s going sideways.
Signals of a sideways market
(ii) The price creates the following peaks lower than the previous peaks but the following troughs equal to the previous troughs. Perhaps, you will mistake this for a downtrend. But no, this is also considered an unclear (sideways) trend.
Signals of a sideways market
Why shouldn’t we trade in Olymp Trade when the market goes sideways?
Trade Fixed Time based on Support/Resistance
There is a lot of knowledge on how to trade Fixed Time with Support and Resistance as follows: When the price hits the support, open UP orders. On the contrary, when the price touches the resistance, open DOWN orders.
I know a few strategies such as the Bollinger Bands that combine with support/resistance. The formula looks like this: Open UP orders when the price falls out of the lower band and hits the support zone. On the contrary, open DOWN orders when the price gets over the upper band and hits the resistance zone.
Trade Fixed Time based on Support/Resistance
And if you are taught to trade in Olymp Trade as above, sooner or later, you will lose all your money.
Let me repeat the only way to make money in Olymp Trade: Only open orders with high winning probability which you are willing to trade with your own money. Going against this principle, you will lose money.
Just imagine this:
In an uptrend, there is 1 and only 1 signal: The price continuously increases, creating higher peaks after peaks and higher troughs after troughs. And you also have 1 and only 1 action: Wait for the signal and open UP orders.
On the contrary, in a downtrend, you also have only 1 sign: The price continuously declines, creating lower peaks after peaks and lower troughs after troughs. And there is only 1 action: Wait for the signal and open DOWN orders.
What about the sideway? There are a lot of available signals. And there are 2 actions: Open UP or DOWN orders. So the probability that you can make a correct prediction in a sideways market is very low.
Should I trade Forex in the Sideway?
Answers: Sideway is a sideways trend within a certain amplitude, limited by the support and resistance. This amplitude is usually not enough for you to open a profitable Forex order. Or rather, it is not worth the money we pay for.
What are support and resistance?
So the question here is: What should we do in Olymp Trade when the market is sideways?
How to trade in Olymp Trade when the market is sideways
Strategy 1: Wait for the signal and do nothing
If you are unsure whether the price is going to enter an uptrend or a downtrend, don’t do anything. This is the best way to not lose money in Olymp Trade. Rushing into risky trades is no different from gambling. It goes against the principles of a trader. And if you are lucky enough to make money, in the future, you will definitely pay Olymp Trade many times more.
When there is no clear trend (sideway), sit and watch. Because the sideways market gives you so many opportunities after it. All we need is a break-out.
The price breaks out of the support and goes down, forming a downtrend.
The price breaks out of the support zone and then returns to retest that zone
When the price breaks out of the resistance zone and goes up, an uptrend will appear.
The price breaks out of the resistance zone and then returns to retest that zone
And when price breaks out to enter a trend, we will take action.I have shared in great detail in this series with the 2 following articles:
Strategy 2: Trade Forex in a sideway with a wide amplitude
What is a sideway with a wide amplitude? Simply put, the price goes sideways within a large range which is enough for you to make money in Forex. If the price is only moving sideways in a narrow range, you will not be able to make money.
How can I determine the width of a sideway? Answers: Use a Japanese candlestick chart with the time frames of 1 hour, 4 hours, or even 1 day. You will now see that the price goes sideways within a wide enough range.
Why should we only trade Forex in Olymp Trade? Because Forex offers a stop-loss if you guess it wrong.
A detailed guide on how to trade Forex in Olymp Trade in the sideways market
Use the 4-hour Japanese candlestick chart.
The 4-hour Japanese candlestick chart
Identify support and resistance zones for this candlestick chart
Identify support and resistance zones
Open an UP order when the price enters the support zone. Conversely, open a DOWN order when the price enters the resistance zone. Only trade Forex with a safe stop-loss.
How to trade Forex in Olymp Trade in the sideways market
You should set a take-profit to ensure profitability for your account. In an uptrend or a downtrend, the price only goes one way. When the market goes sideways, the price direction is very unpredictable. So you should actively set yourself a desired take-profit.
The last line
I don’t recommend trading in a sideways market, because for me it’s too risky. This is the time when the market is back to balance. It prepares for a new period of uptrend or downtrend. That is the real opportunity for you to make money.
Remember:Never lose money. And in trading, we have to protect money at all costs. Sideway means no trend, so nothing is certain. Therefore, we should not risk trading orders with a low probability of winning.
So the 10th article has been over. I hope you understand why I advise you not to trade in Olymp Trade when the market has no trend. We are halfway through the 20-article series making money from Olymp Trade. I will list out the old article links below for you to review.
Why are you always a losing trader? Why have you never made any money in trading? Give me your Olymp Trade trading log, I will give you the answer right away.
How is your personality? How is your trading style? What is your trading strategy?…. Just look at the Trading Log, there will be answers for all of these.
Do you want to draw lessons for yourself? Do you want to adjust your Olymp Trade trading strategy? You want to reevaluate your emotions when waiting for entry points, don’t you?… All answers are in the Trading Log.
This is the reason why I use this whole article to write about a good habit in trading: Review your own trading log.
And before going into the article, let’s take a look back at the deposit and withdrawal process in the 20-article series about making money in Olymp Trade.
Here is my own deposit and withdrawal process from 6 July and to 21 July. The detailed video
The total deposit is $300. And I have made 8 withdrawals with $50 each.
OK! Now we will go to the detailed article.
Habits of reviewing trading log in Olymp Trade
What is a trading log?
Trading log is the place that records all your transactions at the platforms. In Olymp Trade, you can see the details of all your trading orders for the day. You can review all Fixed Time Trade and Forex orders.
What is a trading log?
The reason that every trader should review their Olymp Trade trading Log
Making money is a plan. To concretize that plan in Olymp Trade, you need to learn knowledge, trading strategies, capital management methods, emotional management methods, etc. Reviewing opened orders, actions, and mistakes will help you look back on what has happened and find ways to improve the situation.
Complete your trading strategy in Olymp Trade
What I share, it works for me, not sure it will work for you. You can redesign everything: From how to find a trading signal or how to open an order in Olymp Trade.
Complete your trading strategy in Olymp Trade
To me: EUR/USD and GBP/USD are the most suitable. The time frame for the Japanese candlestick chart is 5 minutes. The expiration time for a Fixed Time order is 5 minutes. 30% is the stop-loss when trading Forex. In Olymp Trade, before trading Fixed Time, I will open a test Forex order to explore the market. And the trading method in Olymp Trade will focus on the trend and find entry signals following that trend.
Olymp Trade trading method
And you? If you still feel 5 minutes is too fast, then extend it to 15-30 minutes. No problem. The longer the time is, the more accurate the signal is, and the more comfortable the psychology is. Review everything. Do not be rigid about a strategy that you have learned.
Capital management method in Olymp Trade
The strategy to make long-term money in Olymp Trade is the combination of methods and a capital management method.
Capital management method in Olymp Trade
To me: Depositing $300 and investing $20 orders is my style. Every day, I just want to earn exactly $50 in Olymp Trade and accept a loss of $30. I will stop if these numbers are correct.
And you? This is not necessarily the right strategy for you. If you are a really patient person, who waits for all day just to open a correct order. You can completely think of the Martingale method.
These are probably the 3 most deadly mistakes in Olymp Trade trading. In trading, the costs of distraction, impatience, and unpredictability are very expensive. Sometimes, you may be lucky enough to make money. But in the future, you will lose more dramatically.
To me: Lots of lessons on focusing come at a cost. Just catch the right trend, you will earn money. Therefore, when the market has entered a trend, we must focus 100% to wait for safety signals and trade.
Loss of concentration in Olymp Trade trading
Here is one such mistake: I opened a DOWN order in Olymp Trade Forex. Because of a few minutes of distraction, I missed out on the opportunity to take profit bringing the best profit.
Review all of your own Olymp Trade orders again. You will see, most of the losing orders are not because the market goes against your judgment. It’s because you were distracted, impatient, or indisciplined.
Mistakes come from emotions
Trading is a game of probability. Therefore, losing or winning is very normal. Sometimes, you are incorrect due to distraction, impatience, and ignoring principles. But, if you lose all the money in your account, the mistake certainly comes from emotions.
Emotions during trading in Olymp Trade
In the series of 20-article about making money in Olymp Trade. There will be 1 article detailing emotions.
One last word
When reviewing your trading log, all your weaknesses and strengths will be clearly shown. Anyone can have access to knowledge. But the reality is that the dynamic numbers are the one who loses money. You want to earn money, don’t you? It’s about skill, discipline, patience, and good emotional management. Therefore, whether you want to or not, you have to practice the habit of reviewing all trading history. Remember “bloody” experiences exchanged with your money.
And here is the 9th articles in the series of 20 articles in a row: Making $1,000 in Olymp Trade. I have listed out other articles below so you can read it again.
