Skip to content

TOP FOREX BROKERS REVIEW

THE INTERNET'S MOST COMPREHENSIVE LIST OF ONLINE FOREX BROKERS AND FOREX REVIEWS. 

How to Calculate Pivot Points

Pivot points are indicators which are used to determine the potential turning
points, for effective trading. These points are calculated along with their
respective support and resistance level, by using previous FX trading session’s
high-low and open-close. Forex being 24 hours running market, the majority of
traders consider the New York sessions as a branch mark. The format which traders
used for trading is shown here –
PP (Pivot Point) = (Low+High+Close)/3
Support and Resistance levels are calculated off PP by –
1st Resistance (R1) = (2 X PP) – Low
1st Support (S1) = (2 X PP) – High
2nd resistance (R2) = PP + (High – Low)
2nd support (S2) = PP – (High – Low)
3rd resistance (R3) = High + 2(PP – Low)
3rd support (S3) = Low – 2(High – PP)
These are the formulas used for calculation PP, now people who have a twisted
relationship with mathematics will curse the fact that why they are trading at FX.
Well, worry not as majority or almost every FX trading software has an inbuilt
Pivot Point calculator which will do the job for you. Hence, don’t hesitate to use
Pivot Points as your FX trading indicator as it comes with the pros of being an
objective type. It is one of the most widely used FX indicators which is objective
type and not derivative or subjective type. It gives fast and smooth trading signs
which can help a trader in various ways. So, here you go, but yes before using PP
for your trading, we advise to go through all the basics and study the indicator
deeply.

Leave a Comment





Scroll To Top