Pivot Points

Pivot points are calculated from the previous period's high, low, and close to project support and resistance for the current period. The pivot is the central level; R1–R3 are resistance levels above; S1–S3 are support levels below. Day traders use pivots for intraday entries and targets.

Standard pivot formula

Pivot = (High + Low + Close) / 3 R1 = 2×Pivot - Low R2 = Pivot + (High - Low) R3 = High + 2×(Pivot - Low) S1 = 2×Pivot - High S2 = Pivot - (High - Low) S3 = Low - 2×(High - Pivot)

Use the previous day's H/L/C for daily pivots. For weekly pivots, use the previous week's data.

Strategies

1. Bounce: Buy at S1/S2, sell at R1/R2 when price bounces.
2. Breakout: When price breaks above R1 with momentum, target R2, R3. Same for breakdowns to S1, S2, S3.
3. Confluence: Pivots often align with round numbers and prior levels. Stronger when combined.
4. Session opens: London and New York opens often react at pivot levels.

Use standard formula for daily pivots. Some traders use Fibonacci or Camarilla pivots—different formulas, same concept. Match to your trading session (daily for day trading).

Do not use pivots in isolation during strong trends—price may blow through levels. Pivots work best in ranging or mean-reverting conditions. Use the correct session: daily pivots for day trading, not weekly.