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