﻿ Pivot Point Calculator | FXCM Australia

# Pivot Point Calculator

A pivot point is a technical tool used in forex trading to determine potential support and resistance levels and the direction of a prevailing trend. While the basis of the indicator is rooted in elementary arithmetic, performing the necessary computations manually is time consuming and cumbersome. However, through the use of the Pivot Point Calculator, traders can quickly and easily execute the necessary calculations in an efficient manner.

Pivot points are especially useful for identifying the presence of a trend and areas of forthcoming exhaustion or reversal. They're typically applied on a daily basis, but may be adapted to specific periodicities as deemed necessary by the trader. Pivots are a powerful indicator for addressing the elasticity of price action. The Pivot Point Calculator is a great way to take full advantage of their advanced utility.

## Using The Pivot Point Calculator

Pivot points come in many forms, each with a varying degree of complexity. The Pivot Point Calculator focuses on four of the most popular among active traders:

• Classic
• Woodie's
• Camarilla
• Demark's

These four pivot types offer the user unique functionality given identical inputs. While the conceptual framework behind each is similar, a distinct set of price points is created upon calculation. Therein lies the beauty of the Pivot Point Calculator—it produces the price points for each pivot with respect to common inputs. Through consideration of periodic highs, lows, and opening and closing values, each set of pivot points may be seamlessly derived.

As an example, assume that an individual is actively trading the EUR/USD on a daily timeframe. The following inputs are taken from the previous forex session:

Input Value
High 1.1425
Low 1.1318
Close 1.1392
Open 1.1408

Given the above constraints, the Pivot Point Calculator automatically generates support and resistance levels for each type of pivot:

Classic Woodie's Camarilla Demark's
Resistance 4 1.1451
Resistance 3 1.1546 1.1421
Resistance 2 1.1485 1.1489 1.1412
Resistance 1 1.1439 1.1446 1.1402 1.1409
Pivot Point 1.1378 1.1382
Support 1 1.1332 1.1338 1.1382 1.1302
Support 2 1.1271 1.1275 1.1372
Support 3 1.1225 1.1363
Support 4 1.1333

Aside from its computational ability, the Pivot Point Calculator is especially useful for comparison purposes. The user-friendly interface displays the support and resistance levels for each pivot type side-by-side. In this fashion, one is able to quickly recognise any differences in the associated price points and adjust trade-related strategies accordingly.

#### FXCM Research Team

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Disclosure

Hypothetical/Simulated Performance: These results are based on simulated or hypothetical performance results that have certain inherent limitations. Unlike the results shown in an actual performance record, these results do not represent actual trading. No representation is being made that any account will or is likely to achieve profits or losses similar to these being shown. Simulated or hypothetical trading programs are generally designed with the benefit of hindsight, do not involve financial risk, and possess other factors which can adversely affect actual trading results.