How to Use Pivots Points for Day Trading

Pivot Points are used by traders to find support and resistance levels based on the previous day's price action.

This indicator is a very useful tool that use the previous bars' highs, lows and closings to project support and resistance levels for future bars.

This indicator provides an idea of where key support and resistance should be. Place the pivot points on your charts and price will bounce off one of these levels. These levels are used by traders to determine market tops, market bottoms or trend reversals.

• Daily pivots points are calculated from previous trading day's high, low, close

This indicator is shown below

Technical Analysis in Energy Trading

The central pivot itself is the primary level, which is used to determine the trend

The other support and resistance levels are also important in calculating areas that can generate significant market movements.

This indicator can be used in 2 ways

The first way is for determining overall trend: if the pivot point is broken in an upward movement, then the market is bullish, and vice versa. However, pivot levels are short-term trend indicators, useful for only one day until they need to be recalculated.

The second method is to use these points to enter and exit the markets. This indicator is a useful tool that can be used to calculate the areas that are likely to cause price movement.

These points should be used conjunction with other forms of analysis such as Moving averages, MACD and stochastic oscillator.

This indicator can be used in many different ways. Here are a few of the most commonly methods for utilizing them.

Energies Trend Direction: Combined with other analysis techniquesmethods such as overbought/oversold oscillators, volatility measurements, the central point may be useful in determining the general trending direction of the market. Trades are only taken in direction of the trend. Buy signal occurs only when the market is above the center pivot point and sell signal occur only when the market is below the center pivot point.

Energies Trading Price Breakouts: A bullish signal occurs when the market breaks up through the center pivot point or one of the resistances (typically Resistance Area 1). A bearish signal occurs when the market breaks down through the center point point or one of the supports (typically Support Area 1).

Energies Trend Reversals:

• A buy signal occurs when price moves towards a support level, gets very close to this point, touches this point, or only moves slightly through it, and then reverses and moves back in opposite direction.

• A sell signal occurs when price moves towards a resistance level, gets very close to this point, touches this point, or only moves slightly through it, and then reverses and moves back in opposite direction.

Stop Loss &/or Limit Profit Values Determined by Support/Resistance: This indicator may be potentially helpful in determining suitable stoploss and/or limit profit placements. For example, if trading a long breakout above the Resistance 1 it may be reasonable to position a stoploss.

Combining with MA Crossover System

A good indicator to combine and trade reversal signals is the moving average crossover which can be used to confirm the direction of a reversal signal.

An investor can then open an order once these two indicators give a trading signal in same direction.

Moving Average Crossover Method

Moving average crossover method that can be combined with this indicator to come up with a energies system for generating buy & sell trade signals.

To download Pivot points Indicator:

https://c.mql5.com/21/9/pro4x_pivot_lines.mq4

Once you download it open it with MQL4 Language Editor, Then Compile it by pressing the Compile Button & it will be added to your MT4.

Note: Once you add it to your MetaTrader 4, the indicator has additional lines named Mid Points, to remove these additional lines open the MQL4 Language MetaEditor(shortcut keyboard key - press F4), & change line 16 from:

Extern bool midpivots = true;

To

Extern bool midpivots = false;

Then Press Compile again, and it'll then appear as exactly shown on this web site.