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For those of you who trade pivot points

  • #1
  • First Post: Mar 29, 2005 9:17pm Mar 29, 2005 9:17pm
At what point do you call a point as breached? When the candle close is above the point, the main body is above the line, or when the entire candle (tail and all) has no contact with the line? Any help please would be appreciated. Thanks.
  • #2
  • Mar 30, 2005 1:13pm Mar 30, 2005 1:13pm
  •  Trader#0000
  • | Status: Unregistered Trader
Quoting BillTrader
At what point do you call a point as breached? When the candle close is above the point, the main body is above the line, or when the entire candle (tail and all) has no contact with the line? Any help please would be appreciated. Thanks.
To me a point is breached when the candle closes above/below the line.
It is really important to drill into lower timeframes though.
For example when I trade the 15min chart and I see the candle is in the process of breaking through, I will look at the 5min chart for confirmation.
I like to trade the hi/low of the candle that closed above/below the s/r line (pivot line).
  • #3
  • Mar 30, 2005 1:51pm Mar 30, 2005 1:51pm
Bill,

Here's one way to define a break of a support and resistance area.

Credit to John Novak for this...

Don't forget that once support is broken, it then can act as resistance and vice versa...

"BREAKOUTS - HOW TO CLEARLY DEFINE THEM
Let's do a lesson that everyone who trades or looks at confluence areas and trendlines should know and respect and answer the age old question, " how do you know if a confluence area is truly broken or a trendline is truly broken and when can we go the other way with our trading”
There is one scientific and 100% concrete way to define a breakout and it has served us well.

Use a breakout bar technique that requires the market to determine when an area has broken has always in our opinion to be the best. Here are the rules.

YOU MUST HAVE what we call A BOB – COB setup.


BOB = break out bar
COB = confirmation of breakout

RULES FOR BOB - A full bar (HIGH & LOW of bar) must be beyond confluence... works on Trendlines too just as effectively.

RULES FOR COB - a close must exceed the high or low of the (break out bar- BOB). Low if going down, high if going up. This is your (COB)

IF these criteria are met then you have a confirmed breakout. Depending on your timeframe it may take a while to happen. THE HIERARCHY rules apply here too... the larger the timeframe the breakout the more powerful it is usually. One-minute breakouts will signify the potential continuation of the short-term trend. MULTIPLE breakouts will signal the most powerful continuation of trend."

Enjoy!

- George
  • #4
  • Mar 30, 2005 2:36pm Mar 30, 2005 2:36pm
what time are you guys using for the pivot calculations? forex is ambiguous because of its 24 hour nature. ive always used the start of the asian session but im interested to hear what you guys are using.
Relax and be happy.
  • #5
  • Mar 30, 2005 3:17pm Mar 30, 2005 3:17pm
Lets say we are trading anywhere from several hours to several days(a week at the longest).
I use, 1hr, 4hr, daily, and weekly charts.

Here is my question, is there a standard rule of thumb, sort of, that if the price is rising on a daily chart but maybe falling on one of the hourly charts, does one chart, generally over rule the others, based on the trading times mentioned above?

It's frustrating when you see on the 1hr chart, the price going up, maybe the 4hr shows the same pair going down, then the daily showing them going up etc. etc.

Is there a basic rule to follow?

Thanks in advance.
Quinn
I started out with nothing, and I've got most of it left!
  • #6
  • Mar 30, 2005 3:24pm Mar 30, 2005 3:24pm
  •  Trader#0000
  • | Status: Unregistered Trader
Quoting merlin
what time are you guys using for the pivot calculations? forex is ambiguous because of its 24 hour nature. ive always used the start of the asian session but im interested to hear what you guys are using.
Merlin,
Midnight is the most important one to me since I dont trade the asian session much.
If I want to trade Asisa I shift the calculations depending on the time.
My first calculations are based on 1700 EST.
After 8pm EST I use calculations based on 1900 EST and for the european opening I use calculations based on midnight EST
I usually leave the midnight calculations on until the end of day (1700).
  • #7
  • Mar 30, 2005 4:19pm Mar 30, 2005 4:19pm
Quote
what time are you guys using for the pivot calculations? forex is ambiguous because of its 24 hour nature. ive always used the start of the asian session but im interested to hear what you guys are using.

In my opinion midnight eastern seems to be the most accurate to calculate pivots except for any JPY pairs which should be calculated at the opening of the asian session. From my experience so far this has worked the best for me.
  • #8
  • Mar 30, 2005 4:44pm Mar 30, 2005 4:44pm
Quoting quinn
Here is my question, is there a standard rule of thumb, sort of, that if the price is rising on a daily chart but maybe falling on one of the hourly charts, does one chart, generally over rule the others, based on the trading times mentioned above?
price is price is price. a chart is a history of price. and it charts the same price no matter what time frame you are viewing it in. there is no magic in a chart, its just price. hourly bars show you what the price did every hour, minute charts show you whats happening every minute. they are just different sunglasses for looking at price. much like indicators are (and why you will often hear me tell people that there is no magic in indicators).

so the answer to your question is no, there is not a rule of thumb. what you will want to do is choose a time scale that fits your trading horizon. if you are a day trader (hold positions less than 24 hours) you will want to look at 5min or 1 hour bars because that gives you decent resolution into the price movements. if you are a long term trader you will want to use daily bars because the hourly movements are pretty much irrelevant when you are holding positions for a year.
Relax and be happy.
  • #9
  • Mar 30, 2005 4:47pm Mar 30, 2005 4:47pm
Quoting mfrr
Merlin,
Midnight is the most important one to me since I dont trade the asian session much.
If I want to trade Asisa I shift the calculations depending on the time.
My first calculations are based on 1700 EST.
After 8pm EST I use calculations based on 1900 EST and for the european opening I use calculations based on midnight EST
I usually leave the midnight calculations on until the end of day (1700).
interesting stuff. i like how you are shifting the time to fit when you trade. have you ever put any of this into code or are you trading it all discretionary?
Relax and be happy.
  • #10
  • Mar 30, 2005 4:50pm Mar 30, 2005 4:50pm
Quoting forexfan
In my opinion midnight eastern seems to be the most accurate to calculate pivots except for any JPY pairs which should be calculated at the opening of the asian session. From my experience so far this has worked the best for me.
ive played with the midnight est as well, ive gotten some good results on the european pairs. but i decided to go with beginning of asian session so i could trade the EURUSD GBPUSD and USDJPY all on the same system. i could probably get more out of it if i adjust the pivot calc times based on the currency, but i hate to go against the rule of not customizing the system to fit a specific pair. maybe this is an exception though because it is based on time and not price.
Relax and be happy.
  • #11
  • Mar 30, 2005 6:01pm Mar 30, 2005 6:01pm
Quoting merlin
price is price is price. a chart is a history of price. and it charts the same price no matter what time frame you are viewing it in. there is no magic in a chart, its just price. hourly bars show you what the price did every hour, minute charts show you whats happening every minute. they are just different sunglasses for looking at price. much like indicators are (and why you will often hear me tell people that there is no magic in indicators).

so the answer to your question is no, there is not a rule of thumb. what you will want to do is choose a time scale that fits your trading horizon. if you are a day trader (hold positions less than 24 hours) you will want to look at 5min or 1 hour bars because that gives you decent resolution into the price movements. if you are a long term trader you will want to use daily bars because the hourly movements are pretty much irrelevant when you are holding positions for a year.
Thanks Merlin
Quinn
I started out with nothing, and I've got most of it left!
  • #12
  • Mar 30, 2005 9:50pm Mar 30, 2005 9:50pm
  •  Trader#0000
  • | Status: Unregistered Trader
Quoting merlin
interesting stuff. i like how you are shifting the time to fit when you trade. have you ever put any of this into code or are you trading it all discretionary?
I am a discretionary trader. No automation (haven't found a good way to automate my trading yet).
The only automated thing I have is an indicator that automatically calculates and plots the pivots for me based on time input.
  • #13
  • Mar 31, 2005 2:19pm Mar 31, 2005 2:19pm
INTERVAL CHARTING -(Inventor, Professor 4X) is used to correlate as many prices as possible to identify strong resistance and support lines. Compare time scale Bollinger Bands, Hband/resistance-Lband/support, the more that match or correlate the stronger the indicator. To find the trend go to the furthest chart out, Daily, and proceed all the way to the shortest term (1 min.) to find the best entry with the assumption all time intervals have a follow the leader mentality, the chart or time scale above always influences chart below. To stay one step ahead of possy when entering you can assume that if the 30 min broke with momentum and the 1 hr stoc's is below 20 that it will reverse as well. etc etc etc. Also on the daily stoc's when the point differential is greater than 15 between the current market price and moving avg price, its is great indicator of direction for at least next pip move. Rule of Thumb, take the difference of two and muliply it by ten to give you next target of support or resistance based on direction of current trend. Once you identify, resistance and support, this is very strong for tight stops and minimizing losses. Rule of Thumb: Multiply Time Scale by 5 to give time for the Stochastic Slow to go from 80 overbought to 20 oversold and visa versa. Example: 1 hr. = 5 hrs., 2 hr. = 10 hrs., Daily = 5 days., etc. Works best on time scales past 15 min. Only guide not fact.
Trading should be FUN, If not your playing over your head !
  • #14
  • Mar 31, 2005 4:04pm Mar 31, 2005 4:04pm
Quoting capitolflow
INTERVAL CHARTING -(Inventor, Professor 4X) is used to correlate as many prices as possible to identify strong resistance and support lines. Compare time scale Bollinger Bands, Hband/resistance-Lband/support, the more that match or correlate the stronger the indicator. To find the trend go to the furthest chart out, Daily, and proceed all the way to the shortest term (1 min.) to find the best entry with the assumption all time intervals have a follow the leader mentality, the chart or time scale above always influences chart below. To stay one step ahead of possy when entering you can assume that if the 30 min broke with momentum and the 1 hr stoc's is below 20 that it will reverse as well. etc etc etc. Also on the daily stoc's when the point differential is greater than 15 between the current market price and moving avg price, its is great indicator of direction for at least next pip move. Rule of Thumb, take the difference of two and muliply it by ten to give you next target of support or resistance based on direction of current trend. Once you identify, resistance and support, this is very strong for tight stops and minimizing losses. Rule of Thumb: Multiply Time Scale by 5 to give time for the Stochastic Slow to go from 80 overbought to 20 oversold and visa versa. Example: 1 hr. = 5 hrs., 2 hr. = 10 hrs., Daily = 5 days., etc. Works best on time scales past 15 min. Only guide not fact.
Thanks Capitol, much appreciated
Quinn
I started out with nothing, and I've got most of it left!
  • #15
  • Mar 31, 2005 5:06pm Mar 31, 2005 5:06pm
STOCHASTIC SLOW-(Inventor, George Lane) In simple terms, the stochastic oscillator measures the current currency price, compared to its historical price for a given time period. This study is one of the most commonly followed indicators in the FX market. It measures the degree by which a currency is overbought or oversold. The scale for the indicator is 0 to 100. Readings above 80 indicate overbought conditions, and reflect the fact that the currency is strong and the price is closing near the high of the trading range. Readings below 20 indicate oversold conditions and reflect the fact that the currency is weak and is closing near the low of the trading range.


TRADE SIGNAL: When the two lines cross over 80 or under 20, best identifiable with daily chart for trend and reversal. Must have a clear break out and the further the distance between current price and moving avg price the greater the momentum.

VERY STRONG INDICATOR
Stochastics are most useful in measuring the strength of a trend or as a a coming reversal in prices. Many traders find that the best trading opportunity comes when their stochastic indicator is flattening out or moving in the opposite direction of prices. When these divergences occur, it's time to book profits and/or to establish a position in the opposite direction of the prior trend.
Trading should be FUN, If not your playing over your head !
  • #16
  • Apr 1, 2005 12:13am Apr 1, 2005 12:13am
Can someone explains me what`s a pivot point,please? something about calculating previous high,
low,close...?

Thanks in advance.
  • #17
  • Apr 3, 2005 7:09pm Apr 3, 2005 7:09pm
They say I got ta learn, but nobody's here to teach me
If they cant understand it, how can they reach me?
I guess they can't -- I guess they won't
I guess they frontin; that's why I know my life is outta luck

We keep spending most our lives
Living in the Forex Paradise,
We keep spending most our lives
Living in the Forex Paradise.

Tell me what`s a pivot poiiiiiint! (sing it,Coolio style).
  • #18
  • Apr 3, 2005 7:13pm Apr 3, 2005 7:13pm
This Forex thang is tough,
feels like I`m in the joint,
everyone play rough,
don`t wanna tell me about pivot point.
  • #19
  • Apr 3, 2005 11:51pm Apr 3, 2005 11:51pm
Here ya go Alex....

www.investopedia.com/terms/p/pivotpoint.asp


Several calculators are available on the Web.
Don Life is expensive, but includes a free trip around the sun.
  • #20
  • Apr 4, 2005 5:30am Apr 4, 2005 5:30am
Quoting mfrr
I am a discretionary trader. No automation (haven't found a good way to automate my trading yet).
The only automated thing I have is an indicator that automatically calculates and plots the pivots for me based on time input.
i hear this a lot, discretionary guys doing well with pivot points. its it working out for you? it makes sense to use them because a lot of traders/funds are looking at those points as the support and resistance.
Relax and be happy.
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