Pivot points and fib levels

So I’ve read the babypips school pages and I’m very interested in Fibonacci and pivot points, but I’m a little confused on how they’re calculated.

If I’m trading a 4 hour chart are pivot points re-calculated every 4 hours? And is there a drag and drop in mt4?

I think I have a better grasp on fib but it seems a bit subjective and if I’m re-plotting for every market wave, I’m concerned that I might be doing it wrong?

How do you use them? I wanted to somehow combine them into a ma crossover system…I think… Don’t quite know how yet…I’m just starting out!

Any help and advise is greatly appreciated?

Perhaps someone even just has a link that could help me out?

Hi, I’m not the best person to answer this by any means but don’t like to see you going unanswered so perhaps if I bump this others will pile in!

For what it is worth: Pivot Points won’t necessarily recalculate every four hours on a four hour chart, as you can show any interval of Pivot on any chart. I use eSignal and have never tried MT4 so don’t know whether there is a drag and drop. In eSignal I right-click and it gives me a menu of all the various indicators, from that I select Pivot Points which brings up a new menu from which I select the interval of my Pivot Points.

Personally I have never heard of a four hour Pivot. I have a Daily Pivot on all my intraday charts, plus Weekly and Monthly Pivots on my higher timeframe charts. I have this saved onto my chart templates, so each morning I log in and it has already applied the new day’s Pivot to my chart. I would suggest that Pivots in more conventional time intervals, such as those I use, are more likely to give a tradeable market reaction, as quite apart from anything else these things often become self-fulfilling - for example, many people will be watching the Daily Pivot, so you are more likely to see a reaction there.

Which brings us onto Fib, you have touched on one of the key issues: it is very subjective. The question of whether Fib works because it works, or works because enough of us apply it to our charts has been kicked around by traders for years. There is also a third camp who don’t care as long as it works. (Dale (DPaterso) is always up for a fun discussion on this, and knows his stuff if you want more detail.)

Fib is subjective, yes, but as long as you draw it from pretty obvious highs and lows, and don’t overclutter the chart by overreading significance into every minor peak and trough, then there will be other traders watching the same levels. Fib is very simple to apply, can be quite subtle to interpret, particularly when used to set TP in a ‘clean’ area of the chart. If you are drawing from clear highs and lows then the chances are you are drawing it correctly.

Personally, I would recommend simply watching Fib levels for a few weeks while not trading them, see if you build up a feel for it. It is like anything, some traders don’t use it, others swear by it. Anyone making consistent money from a consistent method is right for them!

In terms of combining Fib with a MA crossover system - ultimately, in my opinion, trading boils down to Support & Resistance. Both Fib and MAs will give you S&R level on your chart, so looking for areas where Price intersects with both and seeing how Price reacts could lead to some interesting conclusions. Certainly I often have both EMAs and Fib on my charts. Pivots can give a third layer to the same level.

I won’t ramble on and risk confusing you, but hopefully I have given you some food for thought on your two original questions.

Sorry that your original posts drew no immediate response - it was Valentine’s Day, yesterday - at least, here in the UK - so perhaps we were all away romancing?!

ST

Yes, a 4 hour pivot point indicator is recalculated every 4 hours. You can do a Google search for a free pivot point indicator in MT4, they are available.

Fibos just take practice. You should learn from someone who trades them. They never worked for me, but they do work for some people.

Thanks SO much for the responses!!!