Pivot point reference point?
I have a question and was wondering if anyone could answer it and or proivide a best practice in how this shopuld be carried out?
I was wondering when you are setting up your pivot points should you use the previous session OHL in calculating the PP?
I want to make sure I got this right, when trading the EUR/USD I would use 12:00 am EST say as the refernce and go back 24 hours to see the previous OHL range and plug this into the PP calculator to get the PP set up for the upcoming London session?
Is this the general idea on how to set up PP when trading the London session?
Sounds like your using those pivots correctly but the only difference I saw is that the pivot calculations are generally done at the end of the trading day= NY CLOSE 5pm est. If you preffer to use 12pm then thats your choice but ny close is what is widely used. There are 4 hour and Hourly pivots but never really used them.
Heres a helpful link :
Would be interested in knowing how those 4 and 1 hour pivots do
Thanks for the comments ICEBURG I have gone to the link and it says as you say 5pm. I was using the 12 am back 24 hours to better align with the previous session and to match up closer to the london open.
I have read that you could use either?
I wonder which is more relavant to trading the London open and the EUR/USD?
I went to another site and read:
"The pivot point and associated support and resistance levels are calculated by using the last trading sessionís open, high, low, and close. Since Forex is a 24-hour market, most traders use the New York closing time of 4:00pm EST as the previous dayís close. "
Iam wondering if anyone uses the 12 am and back 24 hours? As per previous post is this better suited for trading the London - EUR/USD
Always the point that is closer to your session is more relevant, because in contains more recent price action. However there is the other side of the coin in that the sole reason pivot points work in the first place is because many traders use them. So, if the most traders use the pivots set to 5:00Pm then that is where price is going to stick and bounce from. I have found though, that it really does not make a lot of difference, because the action is so small between these times.
So, the High and the Low for the day pretty much stay about the same...
I personally use the midnight ET time, because it has the most recent price action. And that is the way I was trained to look at it... Just my style and certainly not the only way. Pivots are a somewhat fluid approach.
Thanks for the comment, I will look at both and see what shakes out.
"However there is the other side of the coin in that the sole reason pivot points work in the first place is because many traders use them. So, if the most traders use the pivots set to 5:00Pm then that is where price is going to stick and bounce from."
This is a good point that because so many use them they are self fullfilling?
I also agree 100% that there isn't much variance between the two for the most part.
I guess swimming with the tide is safer?
A diffferent approach to try is use your market open to for the reference time. For example I start trading at 7 am eastern time. I use Camerilla Pivots and find that L-3/H-3 make a nice reversal/break-out point. For example today (5/29), the euro reversed at 2 pips over the L-3.
Camerilla Pivots thats a new one to me I willmhave to look that up?
I will search the forum to see what is said about this, you find they work well for the Euro?
Can you give some refence to where I can do some research on these points?
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