Just a quick questions to those that use pivot points;
Bearing in mind that the rule of thumb is to look for long trades when the pivot opens below price, and short trades when the pivot opens above price, which timeframe are we looking at?
Is it the open of a 24hr period, ie after the NY session close, or do you reevaluate as each session opens?
Hello Rez, since this is part of daily analysis, better to take on the H1 and M30 time frames for your analysis.
As for when to analyze, preference for the European and American session due ton increased liquidity during this time.
Grix
So for instance, if the euro session opens and price is below the daily pivot, but when the previous Sydney session opened, price was ABOVE the daily pivot, you would look for short trades? (Not taking other analysis into account).
I’m just trying to figure out if the opening price of each intraday session establishes a new bias in relation to where daily pivot is, or if the relationship between opening price for the entire 24hr period (sydney open) and the daily pivot are really all you should pay attention to?
Pivots really useful in FX trading. But don’t blindly trust them. You cannot decide whether we are going up or down merely using pivots. You need to confirm this through an Indicator or Through Price Action Setup.
Hey Rez,
The directional bias at the open of a session or day isn’t as important because at the day unfolds there will be more moves that may shape the market. Secondly in trending markets, a counter trend signal may be a fake. So in brief, consider the trend, the market move so far, and what the top tier indicators and price action is indicating.
Currently i am using Mark Brown bespoke pivot points.
And you have to deisgn your crib sheet/strategy to use them in line with the trend.
One way is to use swing high and lows and use time frame correlation.
I have attached the pivot points for the UK session as for 20062013.
And i have also attached a picture of GBPUSD on how it reacted to the pivot points.
A long time ago I used to use pivot points for trading, just trading bounces off the next pivot line if the price cleared a pivot line without a reasonable bounce - it was a scalp only strategy though and required a lot of screen time.
the open doesn’t matter at all, just watch price trading at the central pivot,
sometime it opens above and falls below, then short is the direction you should trade.
then you can trade bounces from it, and this goes for all the pivots even tho the central pivot is the most important one giving us the overall direction, you should not blindly enter just because price is below the pivot,
you need some kind of rejection or collaps in price to confirm,
if the market can’t stay above the pivot, then short is the likely direction and vice versa,
then take some of the profit off at S1 or even the midpoint. good luck