Moving average is the best indicator if you trade with the trend. However, It is always a good idea to combine an indicator with a trend indicator to get better trading signals. Just, like in this article I am going to combine the EMA with Stochastic Indicator to get better results at Olymp Trade.
How to Insert EMA and Stochastic Indicator at the Olymp Trade chart
Once you have logged in to your Olymp Trade account. make sure to set your default chart to the candlestick.
You can add the indicators by clicking on the indicator button. and search for EMA and Stochastic in the menu.
Next, for EMA click on the pencil icon and change the time to 5, 25. You can always change the colours for better results. I have changed the EMA 5 to blue and EMA 25 to orange.
Similarly, you need to add the stochastic indicator on the Olymp Trade chart click on the indicator button and select Stochastic from the menu.
Place calls using EMA and Stochastic Oscillator at Olymp trade trading platform
Trading with EMA and Stochastic Indicator is not that difficult. and these two combination gives a great signal.
In, EMA line 5 responds much more quickly than line 25. Hence, we can say that line 5 is a fast line and line 25 is a slow line. The intersection between these points creates buy or sell opportunities.
Similarly, Stochastic is made from the moving average of 14 and 3. where 14 is a slow line and 3 is a fast line and when these two intersect each other between the overbought (zone 80 ) and oversold (zone 20 ) zone it creates buy and sell calls. When the two lines intersects near or below the oversold zone with the orange line above the other it represents a bullish trend similarly When the two lines intersect above 20 with the blue line above the orange line it signals a bearish trend.
When to Place Buy trade
- When line 5 intersects line 25 from the bottom
- Secondly, line 5 continues to stay above line 25
- Next, the stochastic line intersects at an oversold level and the blue line is above the same.
When to Place sell trade
- When line 5 intersects line 25 from the top.
- Secondly, line 5 stays below line 25.
- The stochastic line intersects each other near the overbought level.
EMA (Exponential Moving Average) and Stochastic oscillator are two technical analysis tools commonly used in trading. The EMA is a type of moving average that places more weight on recent price data, while the stochastic oscillator measures the momentum of an asset by comparing its closing price to its price range over a set period of time.
The EMA and Stochastic oscillator strategy at Olymp Trade involves using these two tools together to identify potential buying or selling opportunities. Traders typically look for bullish or bearish crossovers of the EMA and Stochastic oscillator lines, as well as divergence between the oscillator and price action, to make trading decisions.
While this strategy can be effective in certain market conditions, it’s important to note that no trading strategy is foolproof and there are always risks involved in trading. It’s important for traders to have a solid understanding of technical analysis and risk management principles before implementing any trading strategy.
So, trading with the combination of EMA and Stochastic is very easy and profitable. The best thing you can do is try practising this strategy at the Olymp Trade demo account and move to the Real account once you are confident enough.