Pivot Points

[Bhodee]

I've been reading about Pivot Points and would like to know how others are using them to trade - ie: are you waiting for R1 to be hit, then taking a short position with R2 as the stop and S1 as the target?

Here's the list of forumlas from another thread:

pivot:= (high + low + close) / 3;
r1:= 2*pivot - low;
s1:= 2*pivot - high;
r2:= pivot + (r1-s1);
s2:= pivot - (r1-s1);
r3:= high - (2 * (low - pivot));
s3:= low - (2 * (high - pivot));
sm1:=(pivot+s1)/2;
sm2:=(s1+s2)/2;
sm3:=(s2+s3)/2;
rm1:=(pivot+r1)/2;
rm2:=(r1+r2)/2;
rm3:=(r2+r3)/2;

Using August 4th High, Low and Close of 1.2068, 1.1968 and 1.2051 for the EUR/USD (may be off by a pip or so) I got the following values:

Pivot 1.2029
R1 1.2090
S1 1.1990
R2 1.2129
S2 1.1929
R3 1.2190
S3 1.1890
SM1 1.2010
SM2 1.1960
SM3 1.1910
RM1 1.2060
RM2 1.2110
RM3 1.2160

Does anyone have the URL for Peter Bain's website where he goes over the previous day's pivot points? I've only been able to find his website where he markets his system, I'd love to learn more about pivot points before committing to a system purchase.

Dialogue on pivot points and how you use them would be appreciated.

Thanks.

[tunesmith]

Go to www.fabrefactum.com. They offer software that will automatically download pivot points and has a primer on how to use PP. I have not purchased it myself yet but I do plan to after I decide on a new broker.

Good Luck

[Fas]

Hello

I think this is the site your after:
http://www.tradingsmarts.com/forextradingexamples.htm

Fas.

[Bhodee]

Thanks to both of you. The site that Fas posted is the one I've been looking for.

Bain talks about 4 indicators: Pivot Points; MACD divergence; reading bars; and trendlines.

Does anyone know where MACD (Moving Average Convergence Divergence) can be seen for free on the net? From what I've read it's a fairly complicated chart to figure out on your own - one exponential average subtracted from another.

By reading bars does he mean patterns, such as double tops?

Thanks again.

[Bhodee]

How will you folks calculate your pivots for Monday? Will you use Sunday's information or Fridays with the spike?

Using Friday's data I calculated the following points, but they seem to be spread too wide to use during a "normal" day where the EUR will run 76 pips.

Pivot 1.2201
R1 1.2363
S1 1.2114
R2 1.2450
S2 1.1952
R3 1.2612
S3 1.1865
SM1 1.2158
SM2 1.2033
SM3 1.1909
RM1 1.2282
RM2 1.2407
RM3 1.2531

[Jetheat]

To take the previous days H,L and C to determine todays Pivot Levels, what times do you take?

Do you take it from midnight to midnight? or from 1700 to 1700 (like VT)?

Out of those, are you using EST or London time (GMT)?

Thanks

[Bhodee]

I'm using the midnight to midnight as provided by Oanda on their Daily bar graph. I'm assuming that those are EST times.

Obviously the pivot points would change depending on the times used. I use Oanda's because I don't trade the London hours, which may be a mistake since there's a lot of movement during London's morning but I work 9 to 5 and need my sleep. I'm from Canada and London's open is the middle of the night here.

I figure that I should use the 24 hour period that relates to the times I trade, I'll adjust the times I use of H, L, C if I don't get good results with Oanda's bars.

[automatedtrader]

if i can figure out how to upload it i have an indicator for metatrader that configures your pivot automaticaly....i dont know how to upload if someone can help me ill post it ...figured it out.. there you go.. it does R.5 R1.0 R1.5 R2.0 R2.5 R3.0 pivot and Supports are the same as Resistance...1 thing i noticed is they hit the .5's alot..very usefull just load it up under custom indicators and never have to worry about calculating anything ))