Pivot Point Calculations and Chart

[Connected]

Hey Guys :50:

Using MT4 I have added an indicator which plots the daily pivots, support and resistance levels - however they are always slightly incorrect when compared to daily pivots, support and resistnace levels given by forex data providers on the web.:31:

I calculated the daily pivots, support and resistance levels using the BabyPips calculator and this gave me another slightly incorrect reading when compared to the lines on my chart.

Is this normal for the levels to be slightly incorrect? Some of the levels are 0.5 - 1 pip incorrect, which I guess it not too badly out of snyc but is this normal or should I change indicator or maybe just draw the pivot, support and resistance myself? :41:

Please can any experienced pippers please advise and tell me what you think? Thank you kindly for your help with this! :5:

[Clint]

Most trading platforms use the H, L and C for each period (1 hour, 1 day, 1 week, etc.) to calculate pivot levels for the next period. If different platforms B[/B] open and close each period at the same time, and B[/B] if they happen to print exactly the same Highs, Lows and Closes, and B[/B] if they use the same Pivot Level Formulas — then (and only then) they will generate exactly the same pivot levels.

On the other hand, if one or more of those three conditions, above, are not met — then, you will see discrepancies between the pivots generated by the two platforms.

All platforms agree on the start and end of each 1-hour period, and each period smaller than 1 hour, because all over the world, regardless of time zones, a new hour begins at exactly the same time.

But, different platforms define “days” differently. So, daily candles on different platforms can open and close at different times, and the difference can be as much as several hours. Also, all the time-frames from 2-hour, up to 12-hour, are based on the start time of the “day”. So, platforms which disagree on the open/close time for the daily candle, will also disagree on all the candles from 2-hour up to, and including, 12-hour.

Different platforms may, or may not, generate different [B]weekly[/B] and [B]monthly[/B] pivots, depending on whether those platforms print exactly the same H, L and C for each of those periods, and depending on whether those platforms use the same set of formulas to calculate pivots.

If you determine that your platform, and the Babypips Pivot Calculator, use the same formulas, and if you then input the exact H, L and C (for the period in question) from your platform, into the Babypips Calculator — then, you should get exactly the same pivot levels from both.

You may be surprised at how many different sets of pivot formulas there are. Sets of pivot formulas go by names such as Classic, Camarilla, Woodie, and Fibonacci. The most widely used pivot formulas are the so-called Classic formulas. But, watch out: not all “Classic” formula sets are exactly the same.

Actually comparing the seven (or nine) individual formulas in each formula set is the only sure way to determine that two different platforms, or two different Pivot Calculators, are doing the same thing.

Here is previous post containing additional information which might help you —

http://forums.babypips.com/newbie-island/40796-help-pivot-point-calculation-problem.html#post281506

[Connected]

Most trading platforms use the H, L and C for each period (1 hour, 1 day, 1 week, etc.) to calculate pivot levels for the next period. If different platforms B[/B] open and close each period at the same time, and B[/B] if they happen to print exactly the same Highs, Lows and Closes, and B[/B] if they use the same Pivot Level Formulas — then (and only then) they will generate exactly the same pivot levels.

On the other hand, if one or more of those three conditions, above, are not met — then, you will see discrepancies between the pivots generated by the two platforms.

All platforms agree on the start and end of each 1-hour period, and each period smaller than 1 hour, because all over the world, regardless of time zones, a new hour begins at exactly the same time.

But, different platforms define “days” differently. So, daily candles on different platforms can open and close at different times, and the difference can be as much as several hours. Also, all the time-frames from 2-hour, up to 12-hour, are based on the start time of the “day”. So, platforms which disagree on the open/close time for the daily candle, will also disagree on all the candles from 2-hour up to, and including, 12-hour.

Different platforms may, or may not, generate different [B]weekly[/B] and [B]monthly[/B] pivots, depending on whether those platforms print exactly the same H, L and C for each of those periods, and depending on whether those platforms use the same set of formulas to calculate pivots.

If you determine that your platform, and the Babypips Pivot Calculator, use the same formulas, and if you then input the exact H, L and C (for the period in question) from your platform, into the Babypips Calculator — then, you should get exactly the same pivot levels from both.

You may be surprised at how many different sets of pivot formulas there are. Sets of pivot formulas go by names such as Classic, Camarilla, Woodie, and Fibonacci. The most widely used pivot formulas are the so-called Classic formulas. But, watch out: not all “Classic” formula sets are exactly the same.

Actually comparing the seven (or nine) individual formulas in each formula set is the only sure way to determine that two different platforms, or two different Pivot Calculators, are doing the same thing.

Here is previous post containing additional information which might help you —

301 Moved Permanently

Hey Clint,

Thanks for taking the time to explain the pivots, it is actually a lot deeper than I imagined but thanks to you I now have it figured out! I have set up a pivot indicator in MT4 which utilises the daily figures from the 5pm EST/10PM GMT close in NY/LON and this data corresponds not exactly but close enough due to the different data feeds.

Thanks again for taking the time out to explain in such length and the link with further info was useful also! Thanks Clint I appreciate your help. :50:

[PaladinFX]

Most trading platforms use the H, L and C for each period (1 hour, 1 day, 1 week, etc.) to calculate pivot levels for the next period. If different platforms B[/B] open and close each period at the same time, and B[/B] if they happen to print exactly the same Highs, Lows and Closes, and B[/B] if they use the same Pivot Level Formulas — then (and only then) they will generate exactly the same pivot levels.

On the other hand, if one or more of those three conditions, above, are not met — then, you will see discrepancies between the pivots generated by the two platforms.

All platforms agree on the start and end of each 1-hour period, and each period smaller than 1 hour, because all over the world, regardless of time zones, a new hour begins at exactly the same time.

But, different platforms define “days” differently. So, daily candles on different platforms can open and close at different times, and the difference can be as much as several hours. Also, all the time-frames from 2-hour, up to 12-hour, are based on the start time of the “day”. So, platforms which disagree on the open/close time for the daily candle, will also disagree on all the candles from 2-hour up to, and including, 12-hour.

Different platforms may, or may not, generate different [B]weekly[/B] and [B]monthly[/B] pivots, depending on whether those platforms print exactly the same H, L and C for each of those periods, and depending on whether those platforms use the same set of formulas to calculate pivots.

If you determine that your platform, and the Babypips Pivot Calculator, use the same formulas, and if you then input the exact H, L and C (for the period in question) from your platform, into the Babypips Calculator — then, you should get exactly the same pivot levels from both.

You may be surprised at how many different sets of pivot formulas there are. Sets of pivot formulas go by names such as Classic, Camarilla, Woodie, and Fibonacci. The most widely used pivot formulas are the so-called Classic formulas. But, watch out: not all “Classic” formula sets are exactly the same.

Actually comparing the seven (or nine) individual formulas in each formula set is the only sure way to determine that two different platforms, or two different Pivot Calculators, are doing the same thing.

Great contribution, Clint … knowledgeable, yet written in an easy-to-understand way … 5 stars, thanks.

O.

[system]

I’ve made a pivot point calculator indicator for MT4 myself. It includes Daily, Weekly & Monthly pivot points (if you prefer to set). I can upload it for you if you want.

Also on the subject, Clint described it very well, though forgot to mention one thing. That is, most of the brokers actually don’t have the exact matching ticks. Especially with Retail Brokers. ECN, Reuters & Currenex actually have slighty different feeds in terms of 0.5 - 2 pips (Maybe more sometimes when the market is crazy). But if you rely on your Broker and assuming it is a market maker, you are guaranteed to be up to 5 pips off beat. But anyway you look at it, Pivot Point calculations shouldn’t be drastically different assuming the calculations are made with the same method.

To top it of, MQL4 has a special function of iHigh, iLow, iOpen, iClose in terms of period. I’ve made the indicator to actually rely on Daily Candlestick High-Low-Close which disregards the Date & Hour because Globally a Daily Close is a Daily Close no matter the feed (With a slight pip difference from broker to broker). So it is more reliable. Custom Made to serve my own purposes. (Though currently I’m only using only Monthly Pivot Points).

Have fun.