Olsson featured regularly at full-back during his six years at Ewood Park with Blackburn Rovers.
However, having played the 25-year-old in a more advanced role during last week's friendly match against Braga, Hughton has admitted that he could now play the Sweden international in that position on a regular basis.
"I think Martin showed in the first period that he is the type of player who can play one further forward. He certainly gives us this option," the Eastern Daily Press quotes him as saying.
"It was disappointing not to have seen more of him during pre-season. We knew that at the time when he first arrived that he had picked up an injury towards the end of last season and perhaps we had to take things a little slower with him."
The Canaries will take on Real Sociedad tomorrow evening at Carrow Road.