Which Pivots???

[Minetoo]

There is a lot of discussion on these boards regarding Pivot Point trading and calculation and the purpose of this thread is to come to some definitive conclusions about which Pivot Point calculator and calculation method is best.
There are four (4) PP calculators on this site alone and numerous other ones available elsewhere. My question is which one has the greatest validity? Does the user input session data or 24 hour data? Do you use the close or the settlement price? What about the vaunted and somewhat secretive 'floor trader' pivots? In sum, is there a consensus (and attendant back-testing) as to which numbers and which calculator works best?

[TinGull]

I personally use the regular ol' classic pivot calculations:

R4 = R3 + RANGE (same as: PP + RANGE * 3)
R3 = R2 + RANGE (same as: PP + RANGE * 2)
R2 = PP + RANGE
R1 = (2 * PP) - LOW
PP = (HIGH + LOW + CLOSE) / 3
S1 = (2 * PP) - HIGH
S2 = PP - RANGE
S3 = S2 - RANGE (same as: PP - RANGE * 2)
S4 = S3 - RANGE (same as: PP - RANGE * 3)

I use only the 9:30-4:15 session for my calculations, and find that they work perfectly well. I also use Market Profile "value area" pivots to trade from.

[notouch]

I also prefer the classic pivots but I can't see the logic of using the 0930-1615 hours. It doesn't correspond with YM, DJ or NYSE open hours. I think it's best to use either the official YM high, low and close (or settlement) from the CBOT website or use NYSE hours (0930-1600).

[TinGull]

Well, logic or not, I've never had an issue with them.

[dalby]

ime, with YM - the 24 hr session is superior (price respects these pivots) more than the day session. again, just my experience.

i also find that YM more frequently "respects" floor trader pivots vs. ES. i have no idea why

[notouch]

That's my experience too dalby. Mypivots.com uses the 24 hour ECBOT session with the 1615 settle price as the close. Using the 1700 close is also an option. Definitely there are sometimes highs and lows in the electronic-only session that you don't want to exclude from your pivot calculations.

[dalby]

forgot to mention...

i've noticed also that the pivots calculated using the SETTLE price (which is sometimes different than the close) are usually better respected.

[onlyanik]

Hello,
I would like to share my view on pivot point. In Indian Market 2nd Pivot level works better in both side. Yet my logic says one should not work blindly only on pivot levels. I think other parameters,tools will add up confidence.
Say if a got a Fibbonacci level coinciding with any of the pivot levels, in some case it might give me confidence on the level. Thanks & Pls give me your feedback.

Anik Mitra
Kolkata,India

[BlowFish]

What Tin Gull said traditional ones 'work' just fine. Sometimes on the DAX they are almost magical. Of course at other times when business is slow they are chopped from side to side as stops are run and traders lured in. Actually this can be the case with any well known line or formation, if there is no underlying order flow the fakirs come out in force

Cheers,
Nick.

[Minetoo]

What about tight, range-bound days (aka 'chop' or 'random rotational days') when the price action doesn't even come near the pivot lines? Are they just discarded on these days and some other strategy employed?