There is an old adage which says that in comedy, timing is everything. There are many short-term investors that would argue the same holds just as true for trading.
If you're a long-term trader, the precise timing of when you enter a trade—while still important—isn't totally vital. When you start to shorten up your trading timeframe, though, the exactness of your timing starts to play an increasingly crucial part.
Consider a long-term trend follower. He might only need to look at his charts once a day, to check whether the latest daily bar is signalling to enter a trade or not. An hour lost here or there makes little difference to his profit in the context of the weeks or months that he might hold a trade.
In comparison, the short-term trader needs to be aware of what is happening much more frequently than this. For the short-term trader, the clock is always ticking. Being ready for when the next candle on their chart appears, means being ready for a potential trading signal. That can mean the difference for a scalper between a profit and a loss. But how to know at a glance when a new candle will appear?
A candle timer indicator counts down how much time remains in the current candle of your chart. Candle timers display exactly how many minutes and seconds remain before the current candle closes and a new one opens. This allows you to be on the ball as soon as the next candle appears.
This article will show you how to download one of the best candle timer indicators out there for Metatrader 4. We'll also take a look at how such a candle indicator might be used in conjunction with a short-term FX candle trading strategy.
How to download a candle timer indicator for MT4
There is no candle timer indicator in MT4 that comes as part of the standard tools and indicators. This means you'll have to find a custom indicator to download if you want to use a candle countdown timer.
As is usually the case when it comes to custom indicators, there's a fair amount of choice out there. A quick online search will show you there's a number of Candle Countdown indicators available and most will do what they say on the tin. The main variation you will find is in how much flexibility they afford you in terms of configuring variables. Some are much better in this regard than others.
The Admiral Candle Countdown indicator offers a high degree of flexibility in this area. Handily, it also comes as part of a larger package of tools and indicators included free with Admiral's MetaTrader 4 Supreme Edition.
You can read a rundown of the other cutting edge tools you gain with MT4SE in this List Of Indicators. A lot of custom indicators are put together by enthusiasts, but the extensions available with the MetaTrader 4 Special Edition plugin are all coded by professionals.
The 15-minute EUR/USD chart below shows the default style of the Admiral Candle Countdown indicator:
The countdown appears in white text in the bottom right hand corner of the screen next to an hourglass icon. You can very easily configure the location, size and colour of the indicator to suit your preference, along with several other variables.
When you first launch the indicator, you can see the list of configurable attributes by selecting the inputs tab. Double-click on a listed input to change its value.
With the options available, you can position the MT4 candle timer just about anywhere you want on your chart. As you can see from the screenshot above, there are five main choices: any of the four corners or in line with the price. You can also fine tune these positions by entering values for X and Y coordinates.
In the screenshot, I've selected the countdown timer to appear in line with price. For this to work you have to ensure you have activated Chart Shift, which pushes the chart to the left. To do this, select the Charts tab at the top of your MetaTrader 4 terminal and then click on Chart Shift in the dropdown menu.
Also notice that the Admiral Candle Countdown indicator allows you to modify the timeframe to a value different from the chart you are using. Let's say, for example, that you were mainly looking at a 15-minute chart but also keeping tabs on the larger trend with an hourly chart in the background. You could set the candle countdown timeframe on your M15 chart from the default value of current chart to H1. This would allow you to keep an eye on when the hourly chart is next going to update, without having to keep tabbing back and forth.
Perhaps most handily of all, you can set an alert. This will notify you a certain number of seconds before the new candle appears. The default number of seconds is set at zero, but this value can be set to whatever you want.
Most indicators work better when backed up with another. This is even more true for the candlestick timer indicator. You will likely find a candle timer to be of limited use in isolation. Where it comes into its own is as a way of sharpening up your usage of other indicators. Your MT4 candlestick timer indicator therefore is best used with at least one—and probably two—other indicators.
The kind of scenario where it is useful is where an indicator shows a certain condition that means the next candle could be your signal to trade. The candle timer will then keep you prepped for the appearance of the next crucial candle that may or may not be a signal to trade.
Let's a look at a simple example to illustrate this.
Trading example using MT4 candle time
We said a countdown timer is useful for circumstances in which you suspect the next candle might prove crucial. As an example, I'm going to look at using the Bollinger band squeeze as my main indicator.
Bollinger bands are a form of volatility channel invented by John Bollinger. They plot lines a certain number of standard deviations above and below a simple moving average. You can read more about Bollinger bands in our article on Three Bollinger Bands Strategies That You Need To Know.
As volatility increases, Bollinger bands widen. As volatility falls, the bands narrow. The crux of the Bollinger band squeeze is that the price often breaks out after volatility falls. When the bands narrow significantly on the chart, we are then looking for the next candle to break out above or below the bands. This is our signal for direction.
So at these times of low volatility, we want to be very attentive to that next candle. Knowing exactly when it is going to appear is useful therefore, and this is where the candle timer comes in.
Take a look at the hourly EUR/USD chart below:
Can you see how on the far right of the screen the bands have narrowed tightly in comparison to the rest of the chart? The volatility of the market has fallen considerably. In such a circumstance, we'd want to keep a close eye on the next candle to look for a breakout signal.
As well as the Bollinger bands, I also applied the Admiral Candle Countdown indicator. You can see it on the top right hand side of the screen. To be even more sure of your readiness for the next candle, you could set an alert to notify you when the count is close to zero.
Here's how the chart continued:
The next candle after the squeeze broke above the upper channel, which would be a bullish signal—and the market did indeed continue upward, along with an increase in volatility.
So this is using Bollinger bands as your primary indicator—and the candlestick countdown as an aid to being ready for a signal. In practice, you'd probably also want to use yet another indicator to help confirm the direction of the market in the case of a breakout.
What's going to be your best way to work out which indicators work in effective combinations with each other?
Trying them out for yourself in a risk-free environment.
This is easy with our demo trading account. It allows you to use real indicators with real live prices, but without experimenting with real money. It's a great way to establish which trading styles and strategies work for you and which don't.
Candle Countdown indicator: wrapping it all up
The Candle Countdown indicator is a simple little custom indicator, as easy to use and understand as any charting tool you'll find. What it does is not earth-shattering, but it does satisfy a simple need for many short-term traders. Namely, knowing right down to the nearest second when exactly the next candle is going to appear.
This is a nice little benefit for anyone who needs to be completely in synch with their charts—and it can help enhance your usage of other indicators when you are waiting for a signal. We hope you find it works well for you.