Pivot Point Formulas

[Soultrader]

Different types of pivot point formulas. Simply divide the pivots by 2 to find the midpoints.

Classic Formula

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)

Woodie Pivot Points

R4 = R3 + RANGE
R3 = H + 2 * (PP - L) (same as: R1 + RANGE)
R2 = PP + RANGE
R1 = (2 * PP) - LOW
PP = PP = (HIGH + LOW + OPEN + OPEN) / 4
S1 = (2 * PP) - HIGH
S2 = PP - RANGE
S3 = L - 2 * (H - PP) (same as: S1 - RANGE)
S4 = S3 - RANGE

using OPEN = TODAY'S OPEN, and yesterday's HIGH and LOW

Camarilla Pivot Points

R4 = C + RANGE * 1.1/2
R3 = C + RANGE * 1.1/4
R2 = C + RANGE * 1.1/6
R1 = C + RANGE * 1.1/12
PP = (HIGH + LOW + CLOSE) / 3
S1 = C - RANGE * 1.1/12
S2 = C - RANGE * 1.1/6
S3 = C - RANGE * 1.1/4
S4 = C - RANGE * 1.1/2

[torero]

Has anyone use Camarilla with success? Don't know much about it and want to learn more about it.

[feb2865]

H1 to H4 and L1 to L4 Levels somehow alike pivots points but calculations are different. The most significant levels are H3/L3 If the market approach these levels a possible breakout is about to happen.

Extremely powerful if you trade Forex. I don't recomend it for futures..

I have a camarilla code for Metatrader. I used camarilla levels to trade EUR/CHF but not anymore as just two simple horizontal lines will do the trick.

The whole Idea on camarilla levels is to look for periods of acumulation/distribution in longer time frames (4hr, daily, weekly) and spots possible breakouts.

[torero]

So how is the A/D set up or be found? I'm studying to trade forex right now and still looking for profitable system and pairs to trade.

[Manfred]

Hi,

I've been developing my own pivots indicator for sofware I use which doesnt have the feature built-in and was wondering about the preferred approach used to calculate weekly pivots.

Is the week defined literally, i.e. between Monday and the immediate next
Friday or is it regarded as a 5 trading day lookback from a known most
recent Friday.

My question relates to how should I handle non-trading days in the week
(e.g. public holidays) - say a week has 1 non-trading day, so now is the
pivot calc based on 4 days or does it stick with a 5 day lookback (i.e.
assume every 5 daily bars make up a week). If there are 2 holidays in one
week is the pivot then based on 3 days and so on?

Once I've gotten that right, I'd tackle intraday, so just quickly on that one would I assume for most commodities 24 hourly bars = 1 day and base my next day pivot on that? e.g. what is the procedure in calculation if a commodity market is closed for part of those 24 hours, is it the last 24 hours = 1 day or do I just use the last 24 bars (assuming of course one's data has no gap errors and its real market data)

Thanks for any explanation.

Cheers

[Manfred]

Two quick links that should get you started with copious amounts of info on Camarilla are:

Camarilla Equation - Free!
Day Trading Online to Financial Freedom with the SureFireThing Camarilla Equation

[Soultrader]

Hello Manfred,

Welcome aboard With weekly pivots, you should use the high/low/close from the Monday to Friday session. In other words, it does not make a difference if there was 3 or 4 trading days. You will simply use those 3,4 days to grab the high/low/close.

For the emini's which are traded almost 24 hour electronically, you will still use the exchange times. The easiest way is to grab the values directly from the price bar on the daily charts. Hope this helps.

[malvado xetra]

Soultrader,

I Have Never Used Any Pivot Strategies, At Least In Spanish Dont Know Them By That Name. Could You Explain To Me Some Of It. What Are They Based Of? And Do You Know Any Web Site Or Bibliography To Enhance My Knowledge Of It. I Think They Can Be Quite Interesting

Thank You

[Soultrader]

You might want to grab John Person's, A Complete Guide To Technical Trading Tactics. This is the book that got me into pivot points.

Pivot points are simple mathematical calculations initially used by floor traders to identify support and resistance. It fairly well known to the public now but the important thing is knowing how to play the pivots. Knowing where the levels are is not enough.

[torero]

I believe floor pivots are more useful in futures, commodities and forex than stocks (personal opinion here). You have to remember that alot of people use or watch pivots. It doesn't mean they work all the time, but how prices react to them and if there are other important levels (fib levels, S/R) near it, it makes that area more likely for prices to respect. John Carter makes the point that R3/S3 areas where prices tend to stop. I tend to rely more on Weekly and Monthly pivots on ER2, especially on forex.