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Pivot point spot strategy

  • #1
  • First Post: Dec 28, 2006 10:36am Dec 28, 2006 10:36am
Can anyone recall such a strategy posted or anyone that uses one?

Are all the strategies MA'S etc?
  • #2
  • Dec 28, 2006 10:49am Dec 28, 2006 10:49am
To me pivot points don't make any sense in the forex market. Too many different sessions and too many different open, high, low and closing values among the many different dealers charts for daily or weekly, etc.
If pivots are to have a significant power and darn near everyone comes up with totally different pivot points, then where exactly is the value to them?
  • #3
  • Dec 28, 2006 11:21am Dec 28, 2006 11:21am
i trade using pivots

for cable and euro i use gmt 0
for yen i use gmt 9 it works for me
  • #4
  • Dec 28, 2006 4:02pm Dec 28, 2006 4:02pm
Quoting jest1081
i trade using pivots

for cable and euro i use gmt 0
for yen i use gmt 9 it works for me
I'll have to try that with yen.

For trading EuroUSD and Cable , I pretty much use gmt 0 too now (22 GMT actually, a little more accurate to me). I use this time for any other pair too, but haven't been comfortable trading most of the rest of them using pivots.

It's doesn't matter that so many use different times. As long as you stick to one they can be very useful. They're like trend lines or any other support/resistance. ...you wait for confirmation that each line is valid before trading them.
Bundy's status today: "Waiting..."
  • #5
  • Dec 28, 2006 4:46pm Dec 28, 2006 4:46pm
Here is my morning pivot newspaper

http://www.fxstreet.com/technical/an...rading-points/
  • #6
  • Dec 28, 2006 5:57pm Dec 28, 2006 5:57pm
I actually looked at a about 4 months of the mathematical pivot points based on the days high low and close for the gbpusd and saw no real significance with them. Unless they were by a fib point which is often the case . For me yesterday my daily pivot for the gbpusd was 1.9580 and the 38.2 fib was 1.9592. So the pound after the close of the day (for my charts it is 6pm eastern) bounced between low of 9554 and the high of 9587 and then once it broke past the the 38 fib it took off for 80 pips are so. Its nice to use time with a pivot for instance the London session opens at 3am. That was a perfect set up with it staying away from the 38.2 fib and then breaking after 3am. But to be honest I was in a short and got stopped out but I seen it coming and hoping it wasnt going to break the 38.2 fib. Just ratteling on because I learned another good lesson for the second or third time. Hope this can help.
Attached Image
  • #7
  • Edited 6:56pm Dec 28, 2006 6:03pm | Edited 6:56pm
Here is a page you may find helpfull...... Currency corellations and pivot points
Same Whore .... Different Dress
  • #8
  • Dec 28, 2006 6:41pm Dec 28, 2006 6:41pm
at times I exclusively trade pivot points as they give me such accurate signals for quick pips. ALthough many people claim they are useless in forex, I truly believe that people use them the wrong way. If using daily pivots, it is the daily close in relation to the pivot that has meaning. If above it, buyers won for the day, and chances are that they will win again tomorrow. I don't try and trade daily pivots because the swings are too big for my bankroll. Hence I use the same formula to create a pivot point indicator on any timeframe. Then I also have another Pivot Point indicator for that same time frame, but instead of it being 1 bars worth, it will be 55 bars worth. If looking at the 1hr chart, this would mean a 55 hr pivot. What is great about this for a 55 hr pivot is that it is dynamic and updates every hour so that you arent staring at a level that is no longer important. It is interesting to see how the different pivots interact with each other, and so I have also created a Pivot Point Convergence Divergence indicator that measures the difference between the two. Within this indicator, I have added standard deviation bands that let me know when a bubble may be forming between the actions of longer term traders and shorter term traders. It is very good at picking up reversals. Finally, just to clean it up, I reverse engineer those bands to overlay on price the price level where the Small term Pivot will be too far from the mid to long term.
Lastly, I'll share one or two relatively easy setups for me using the 1 period pivot. Wait for the market to move. When it begins to stall closing above below above below the pivot, we have the "war" between buyer and seller. The first close above or below that range that is created, go with it. exit half on 10 pips and exit remainder at close below pivot.

Next setup is when price is thrusting(at least 8 consecutive bar close above pivot). Close below, close above, close below - go short. stop loss relative high, and tp will be risk*2 on half, the rest will be at close on other side of pivot. Same reversed for long trade.

Anyway, hope this helps - Oh yeah i use 150 tick charts for these setups. Keeps losses pretty small and lots of times winners will exceed 35-40 pips.
Man who scratches ass should not bite fingernails
  • #9
  • Dec 28, 2006 6:46pm Dec 28, 2006 6:46pm
Thanks for sharing your strategy. Are you saying the 55 'bars worth' pivot from, say the hourly is an average of last 55 hourly bars? How is it calculated is the question. Interesting stuff.
  • #10
  • Dec 28, 2006 6:48pm Dec 28, 2006 6:48pm
[quote=goodthings]I actually looked at a about 4 months of the mathematical pivot points based on the days high low and close for the gbpusd and saw no real significance with them...QUOTE]


This is a moving pivot line on daily chart. Can you see the real significance of it now? You can make money on this alone just trading once per day.
Attached Image
Man who scratches ass should not bite fingernails
  • #11
  • Dec 29, 2006 12:27am Dec 29, 2006 12:27am
Thats very creative Leugimp...u calculate the bars instead...hmmm i must note that.

Anyway, pivots points are basically SRs just like fibos...for me they work very well on the 5 mins... on cable and euro. I can basically see SRs from just laying pivot points on the charts.

Its the technique of using PP that matters, definitely helps the typical price action trader. Always note this...REAL PIVOT users dun use pivot points as a buy sell signal, they use pure price action to determine their trade and PPs are variable SRs and tp popints for em, hope that explains...That does not include u Leugimp coz ur pivots looks pretty much like a stunning PA indicator...YUM can i get a hand on it hehehe.
  • #12
  • Dec 30, 2006 5:10am Dec 30, 2006 5:10am
[quote=Leugimp]
Quoting goodthings
I actually looked at a about 4 months of the mathematical pivot points based on the days high low and close for the gbpusd and saw no real significance with them...QUOTE]


This is a moving pivot line on daily chart. Can you see the real significance of it now? You can make money on this alone just trading once per day.
Hi

Could you please post the moving pivot line indicator for us

Thanks

howard
Regards
  • #13
  • Dec 30, 2006 10:25pm Dec 30, 2006 10:25pm
Pivot points are used by floor traders to establish overall support and resistance levels that tell them when a security is more than likely going to give S & R. Sometimes people buy or sell right through the pivot point, or reverse right on it. You have to use the correct floor traders calculations in ploting the points. And you will also need addition indicators that will tell you which price level are significant and which ones aren't. And lastly, you have to know the currency that you trade. Because all the majors have an average daily pip movement and the narrow window that these movements take place. Pivot points is just another very good indicator that will help you capture more pips and lots during peak volitility periods.

Quoting drayco
To me pivot points don't make any sense in the forex market. Too many different sessions and too many different open, high, low and closing values among the many different dealers charts for daily or weekly, etc.
If pivots are to have a significant power and darn near everyone comes up with totally different pivot points, then where exactly is the value to them?
A. Finesse Williams Making Millions One Pip At A Time!
  • #14
  • Dec 30, 2006 10:42pm Dec 30, 2006 10:42pm
To clarify that I mean the actuall pivot point. Not talking of the support & resistence levels that are mathematically calculated. They do have some significance.

Quoting goodthings
I actually looked at a about 4 months of the mathematical pivot points based on the days high low and close for the gbpusd and saw no real significance with them. Unless they were by a fib point which is often the case . For me yesterday my daily pivot for the gbpusd was 1.9580 and the 38.2 fib was 1.9592. So the pound after the close of the day (for my charts it is 6pm eastern) bounced between low of 9554 and the high of 9587 and then once it broke past the the 38 fib it took off for 80 pips are so. Its nice to use time with a pivot for instance the London session opens at 3am. That was a perfect set up with it staying away from the 38.2 fib and then breaking after 3am. But to be honest I was in a short and got stopped out but I seen it coming and hoping it wasnt going to break the 38.2 fib. Just ratteling on because I learned another good lesson for the second or third time. Hope this can help.
  • #15
  • Dec 30, 2006 10:59pm Dec 30, 2006 10:59pm
What is your moving pivot line based on. There are daily weekly monthly and hourly pivot points. Looking at the chart below I would say that the high of the previous day and the daily R1 was a pivot area and the Daily MR2 (daily mid point between R1 & R2) is confirmation of a break out from the daily range. [quote=Leugimp]
Quoting goodthings
I actually looked at a about 4 months of the mathematical pivot points based on the days high low and close for the gbpusd and saw no real significance with them...QUOTE]


This is a moving pivot line on daily chart. Can you see the real significance of it now? You can make money on this alone just trading once per day.
Attached Image
  • #16
  • Dec 30, 2006 11:10pm Dec 30, 2006 11:10pm
You were very informative and find your method of trading with pivot points interesting. I use pivot points and I have success with the way I use them also. But I am interested in learning your method of trading the PP. Also, when you are educating people about anything you have to bring trade lingo to a neccessary minimum. As you already know, not everyone have trading experience. So you render your efforts useless to them. I would like for you to pm me about your method. This forum probably has the combined education of Warren Buffet, and if we all share our limited education with one another we can become the next "Mr. Buffet".

Quoting Leugimp
at times I exclusively trade pivot points as they give me such accurate signals for quick pips. ALthough many people claim they are useless in forex, I truly believe that people use them the wrong way. If using daily pivots, it is the daily close in relation to the pivot that has meaning. If above it, buyers won for the day, and chances are that they will win again tomorrow. I don't try and trade daily pivots because the swings are too big for my bankroll. Hence I use the same formula to create a pivot point indicator on any timeframe. Then I also have another Pivot Point indicator for that same time frame, but instead of it being 1 bars worth, it will be 55 bars worth. If looking at the 1hr chart, this would mean a 55 hr pivot. What is great about this for a 55 hr pivot is that it is dynamic and updates every hour so that you arent staring at a level that is no longer important. It is interesting to see how the different pivots interact with each other, and so I have also created a Pivot Point Convergence Divergence indicator that measures the difference between the two. Within this indicator, I have added standard deviation bands that let me know when a bubble may be forming between the actions of longer term traders and shorter term traders. It is very good at picking up reversals. Finally, just to clean it up, I reverse engineer those bands to overlay on price the price level where the Small term Pivot will be too far from the mid to long term.
Lastly, I'll share one or two relatively easy setups for me using the 1 period pivot. Wait for the market to move. When it begins to stall closing above below above below the pivot, we have the "war" between buyer and seller. The first close above or below that range that is created, go with it. exit half on 10 pips and exit remainder at close below pivot.

Next setup is when price is thrusting(at least 8 consecutive bar close above pivot). Close below, close above, close below - go short. stop loss relative high, and tp will be risk*2 on half, the rest will be at close on other side of pivot. Same reversed for long trade.

Anyway, hope this helps - Oh yeah i use 150 tick charts for these setups. Keeps losses pretty small and lots of times winners will exceed 35-40 pips.
A. Finesse Williams Making Millions One Pip At A Time!
  • #17
  • Dec 30, 2006 11:16pm Dec 30, 2006 11:16pm
How do you plot the bars instead of price?


This is a moving pivot line on daily chart. Can you see the real significance of it now? You can make money on this alone just trading once per day.[/quote]
A. Finesse Williams Making Millions One Pip At A Time!
  • #18
  • Dec 31, 2006 8:26am Dec 31, 2006 8:26am
How can pivot points be a self fullfilling prophecy if none of you can agree on the time, time zone, or the forumula? Also, where is the forex "floor" that all of the floor traders walk around on? I suspect pivot points in forex are no more accurate than randomly generated horizontal lines; sometimes price will reverse and sometimes it will go through.
  • #19
  • Dec 31, 2006 8:42am Dec 31, 2006 8:42am
Quoting philmcgrew
How can pivot points be a self fullfilling prophecy if none of you can agree on the time, time zone, or the forumula? Also, where is the forex "floor" that all of the floor traders walk around on? I suspect pivot points in forex are no more accurate than randomly generated horizontal lines; sometimes price will reverse and sometimes it will go through.
yes phil ur damn right...use it as an indicator...u'll never get it right...use it as a guide...it'll definitely help in trading price action. I've seen good srs for cable and euro at gmt 0 and yen at gmt 9 off the 5 minutes
  • #20
  • Dec 31, 2006 9:46am Dec 31, 2006 9:46am
Hi,Ive been trading cable on 5 min chart using pivot points for 6 months and i feel they do work.
I was sceptical too when i first tried them .Price often spikes right up to a pivot point (where i set a sell order to take a quick profit)and then bounces right back from it.The professional traders use them and automated computer programmed robot traders too ,thats why price moves quickly up to a pivot and then away from it ,or it smashes throu it as if it wasnt there,its where the majority of programmed trades execute.
Pivot points and trend lines are the only form of "looking into the future" in forex.They give you a insight of where price "may" change direction and you should take notice.Moving averages(which most of the stratigies are based on )are looking at the past and hence late,they give you no idea where to look in the future.
By using a stratagie of pivot points trend lines etc i take over 500 pips every
week.My record is over 700pips/week.
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