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What is a pivot point in trading?

A pivot can occur on any timeframe. A pivot can be area that a trader view as important, such as weekly high or low, daily high or low, a swing high /low, or a technical level. Pivot points are calculated levels. Floor traders originally used a pivot point to establish important price levels, and those are now used by many traders.

What is a pivot price?

A pivot is a significant price level known in advance which traders view as important and may make trading decisions around that level. As a technical indicator, a pivot price is similar to a resistance or support level. If the pivot level is exceeded, the price is expected to continue in that direction.

What are standard pivot points?

Standard Pivot Points allow traders to plot support and resistance levels around a central pivot that is determined by a series of simple calculations. The central price pivot takes the sum of the price high, the price low, and the closing price of whichever time period is selected in a trader’s charting station.

Can a pivot point be combined with other trend indicators?

Combining pivot points with other trend indicators is common practice with traders. A pivot point that also overlaps or converges with a 50-period or 200-period moving average (MA), or Fibonacci extension level, becomes a stronger support/resistance level.

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