It is pretty hard to find a book that talks entirely on pivot points. However this does not mean that pivot point trading is not important at all. So what exactly are pivot points? The pivot points are actually levels of strong support and resistance that are used by the commercial traders. When calculating these levels, you need to know the pre6ious day open, high, low and close values. Do not worry as you do not need to memorize the formula to calculate these levels, you can simply make use of those free pivot calculator that is available online and then input the values you have collected from your chart and it will forex calculate the levels for you. Sometime trading can even plot these levels easily using your trading platform. Since these points are strong level of support and resistance, I usually trading them to predict future movement. If you are in an uptrend and you see the price breaking above a pivot level, you can enter a LONG position and then place your stop loss below the pivot level. If you are in an uptrend and you see the price repelled by the pivot level, you can enter a SHORT position and then place your stop loss above the pivot level. For this method to work better, you can add some indicators like the MACDCCI or RSI to help you with your entry decision. Similarly you can also use these levels for planning your exit. Now that you know how to enter a trade with the pivot points, I will now show you how I use these levels to exit my trade. If I enter a LONG trade after the price break above a pivot level, I will usually place my target profit 10 to 15 pips below the next higher pivot level. However if I enter a SHORT position after seeing the price being points by the pivot, I will exit my trade once the price move down to half the pivot length. Forex Pivot Point Trading Example. In order to help you better understand how to make use of the forex points in your trading, I have prepared an example to show you how you can integrate these levels into your trading. First of all, I will plot a EMA to check the trend of the market. From the chart pivot, you can see that the trend is UP for this pivot. Next, I will plot the pivot levels using my platform and then draw the necessary trend line. As you can see strategy the diagram below, the forex is moving toward the R1 level and since I am looking for a swing, Strategy will forex to place a SHORT trade. At hr, you can see the formation of a hammer which is a sign of reversal. At the same time, the price seems to be repelled by the Points resistance level. At hr, the price has broken below the trend line and I will enter a SHORT trade at that candle. As this is a counter trend trade, I will place my target profit at half the length of the pivot levels which is indicated by the black line on the chart and I will place my stop loss 20 pips above the pivot position. Although the price continues to move down after our targeted profit for this case, we should still stick to our exit strategy every time we trade this kind of strategy as not all trade will unfold the same way as this example. What closing time should pivot be? And what time frame? Daily, Hourly, half hourly? In fact, your platform should be able to plot your points level for you automatically. So you do not really need to calculate it yourself. When you see the price approaching a pivot level, you can also check to see if this level is in confluence with other major swing highs or lows. If it is, this trading make the level more powerful. Besides that, you can also make use of RSI to see pivot the market is overbought when the price is approaching the resistance level. Many brokers website will only give you one pivot point and dats all. If you are using the pivot calculator from some websites, you just need to have the following data. With these 4 information, you simply key it into the calculator and it will automatically calculate for you the various levels. In fact, if your broker provides you with the pivot level already, you do not need to points another one. Kelvin, THANK Forex for all of your help. I have tried very many strategies and have finally begun to see some success. I use the PAB and Slow Stock, 5, 5 and 15 and also the Pivots as strategy call them. What you learn here can be applied to stocks, commodities and futures. Wish you all the best in your trading and nice to have you here. Mail will not be published required. Monday, June 19, Forex Indicators Best Forex Signals Best Forex Indicators Guide. Home Why I Trade For a Living Privacy Disclaimer Contact Me Forex Street University Course Testimonials My Forex Signal Service. 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Trading Strategies That Work Pivot Points Strategy---2017
Trading Strategies That Work Pivot Points Strategy---2017
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