To become a professional trader with great orders in Olymp Trade, you need to know an important signal the market provides. That is the Key Level – what helps investors choose the best entry point. In this article, I will guide in detail what it is. How to trade effectively with it. This is for you to learn the ultimate trading techniques of experienced traders.
First of all, to find the Key Level, you need to understand what support and resistance are. If you do not know, please review the article in the link below for more details.
- 1 What is a Key Level?
- 2 How to find and draw the correct Key Level in Olymp Trade.
- 3 Things to note when using the Key Level to trade in Olymp Trade
- 4 In conclusion
What is a Key Level?
It is considered a strong resistance and support zone at which the price reacts many times. This is one of the important price zones that traders should focus on. Because these are the points that determine a long-term up or down market.
How to find and draw the correct Key Level in Olymp Trade.
Step 1: Simplify the candlestick chart
In order to get the most prestigious Key Levels, you need to tidy up the candlestick chart. It is best to get rid of everything besides candlesticks for you to earn a high concentration. Candlestick is the only thing that can help us recognize the Key Levels and the movements of the market around them most clearly.
Notes: Key Levels are the major levels that are usually drawn using the weekly time frame.
Step 2: Draw Key Levels on the weekly chart for a long-term view
As you all know, the longer the candle time frame is, the higher the credibility becomes. With such a principle, the Key Levels of the monthly candlestick chart will be more accurate than those of the weekly candlestick chart. And the weekly candlestick chart will be more accurate than the daily candlestick chart which is more accurate than the hourly candlestick chart (H4, H1).
We need to define the Key Levels of the week to see the trend of the day. A clear view of the long-term trend is the key factor in trading. Therefore, you should not skip this step if you want picturesque entry points.
Take a look at the example below, most Key Levels are drawn from the old price range. When the price hits those zones, it often turns around.
Step 3: Continue setting smaller Key Levels on daily candlesticks
After finishing on the weekly candlesticks, the next thing to do is to identify these Key Levels on the daily candlestick time frame. Here, we can observe short-term Key Levels that cannot be seen on weekly candlesticks. Those will give you more opportunities to enter the market and are known by another name as Near Key Levels.
Step 4: Open orders using H4 and H1 time frames
At these time frames, most professional traders only focus on looking for trading signals. They are usually reversal actions that create Key Levels on daily and weekly candlesticks. In combination with price action in the upper adjacent zones, we can safely open orders.
In my opinion, you should refrain from drawing Key Levels in this time frame. This is because it has a lot of noise signals which are not as accurate as larger time frames (weekly, daily). However, we can also draw them at critical levels that cannot be seen on daily and weekly charts.
Things to note when using the Key Level to trade in Olymp Trade
In order to trade most effectively in Olymp Trade with it, we need to pay attention to the following:
- The difference between “Key Level” and “Near Key Level”.
– Key levels are very important points. They determine if the market is up or down in the long term. It offers extremely high-profit performance on long-term transactions.
– Near Key Levels are also important for determining the market level in the short term. These serve as the signals for you to find the right entry point.
2. Don’t draw too many Key Levels on the chart as it will be distracting
We just need to pay attention to the Key Levels which are near. We can hide other levels which are quite far from the current point when we don’t need them yet. The purpose of tidying up the chart is for you to observe the price easily.
3. Key Levels cannot always be drawn correctly
– There are times when there is a certain deviation but not significantly. It can be drawn across previous candlesticks, as long as it best suits the Key Levels of the current price.
– At the end of each day, we can make adjustments so that the Key Levels are in more precise positions.
Through this article, you may have understood what a Key Level is and how important it is. They have helped professional traders have very precise entry points. You can also look for such reasonable entry points to improve your odds of winning.
To do that, you first need to master how to draw important Key Levels. Then, combine it with technical indicators, candlestick patterns, price patterns, etc., to achieve entry points with the highest possible safety.
Practice drawing lots of Key Levels and trade with them on a Demo account. Let them gradually take shape as a skill, that’s when you start the real fight.