In the early days of knowing Olymp Trade and starting to trade on the platform, perhaps you have tested the Fixed Time trading strategy using the Out Band candlestick with the Bollinger Bands indicator in Olymp Trade. Most of you then realize that this is just an ineffective trading strategy and soon cause you to burn out your account.
If you do not know this strategy, You can review it here:
What is an Out Band candlestick? How to trade effectively in Olymp Trade with it?
In today’s article, I would like to give some personal experience of using Bollinger Bands when trading in Olymp Trade so that you can upgrade the simple trading strategy with Bollinger Bands that I mentioned in the first part. It is these little tips that helped me make money in Olymp Trade with only the Bollinger Bands indicator strategy.
Out Band candlesticks are candlesticks that have the closing price outside the Bollinger Bands indicator. In the online courses, the “teachers” will tell you that when you see an Out Band candlestick, you just need to open reversal orders to win. Some bet the next candle to have the opposite color of the Out Band candlestick. Others open reversal orders with an expiration time of 3 or 4 times the candle time period. They all make the Fixed Time trading strategy in Olymp Trade with the Out Band candlestick go bankrupt.
My trading strategy is also with the Out Band candlestick
This is my trading result in 1 day with Out Band candlesticks based on the Bollinger Bands indicator in Olymp Trade. There were 5 wins, 1 draw, and 1 loss. Therefore, can I say I have already known how to trade effectively with an Out Band candlestick? What is the difference between me and you when trading in Olymp Trade?
To understand that, perhaps we will need to analyze each trading order. Then you will grasp some tips to upgrade this trading strategy. Accordingly, you can turn it into something that can help you make money in Olymp Trade.
Notes to remember when trading with the Out Band candlestick in Olymp Trade
Note 1: Consider the price trend every time opening an order
This is an order that I won easily with the Out Band candlestick. The price went sideways and had no clear trend. And then, the Bollinger Bands really came into play.
On the contrary, please continue with my other order.
This is an order that I luckily won in the last seconds. According to my trading strategy, this order is not allowed. This is because the price just broke out of a level and continued to go down. If you open an order in this case, you will probably lose. Or else, you will have to use Martingale to recover the loss.
Note 2: Previous Out Band or stick-to-the-bands candlesticks are a bad sign to open a reversal order
What do you see in this situation? Before a red candlestick appeared out of the lower band, there were 2 candles including an Out Band candlestick and a green candlestick that closed a small distance from the lower band. In this case, you can only stand outside and watch. If you place an order, be prepared with good psychology because you will need to use Martingale to recover the loss.
The more candlesticks that are close to the bands like this, the less effective for the later signals that the Out Band candlestick gives. It indicates that the price is being crushed and is following a strong trend. If you use the Classic capital management method, ignore these situations.
Note 3: The Martingale capital management method is only effective when there is no news or strong market volatility
As warned above, in case there is a candlestick appearing next to or out of the bands before, if you open an order with a later Out Band candlestick, you will most likely have to use Martingale to recover the loss. And below is a case in which I had to use Martingale.
5 warning candles had appeared before the Out Band candlestick appeared. And as expected, after the green Out Band candlestick had formed, the price continued to rise. I lost the 1st order and broke even on the 2nd one. Only until the 3rd order with the increased investment did I earn some profit in this situation.
If this was a day with strong news or strong volatility, I must have lost heavily on using Martingale. Therefore, do not overuse this capital management method. It’s like a double-edged sword. On the one hand, it will help you recover the loss quickly. On the other hand, it will burn out your account.
Note 4: If you are someone who likes safety, only open orders with Out Band candlesticks when the market goes sideways
That is really the most effective trading strategy using the Out Band candlestick. When the price goes sideways, it will immediately turn around when it encounters stiff levels or readjust around the middle band of the Bollinger Bands. And that is the best time for you to make money with this Out Band candlestick.
Let’s take a look at another win of mine when the price goes sideways.
Up to here, you may have understood the difference between me and you when using the same Olymp Trade strategy. It does not lie in knowledge, in the capital, nor that I am more careful than you. Maybe, because I have stumbled enough on this path, so now I can take it easy.
However, please don’t be discouraged. Go ahead and improve yourself. I and this blog will always be with you on that journey. Goodbye and wish you a successful transaction.