14.07.2019
AAKASHAYA PATRA SEVEN STAR SMART EDUCATION SERIES PART – 16
Pivot Points
Today
we are going to discuss about Pivot Points Pivot Points are help us to identify
Trend as well as future probable support and resistance level of the any stock,
commodity and currency Pivot Points is consist of 5 parallel line where middle,its
a most important line is known as Pivot Line while Upper two lines known as
Resistance 1 (R1) and Resistance 2 (R2) Line and below two lines of Pivot Line
known as Support 1(S1) and Support 2(S2) line Calculation of Pivot Points
The
Formulas for Pivot Points : -
Pivot
Points are calculated on the basis of previous day Low, High and Closed Price
basis
P =
High + Low + Closed
-----------------------
3
R1
= (P×2) -Low
R2
= P + (High-Low)
S1
= (P×2) - High
S2
= P - (High-Low)
Where :-
P =
Pivot point
R1
= Resistance 1
R2
= Resistance 2
S1
= Support 1
S2
= Support 2
Understanding of Pivot Point in Candlestick Chart :-
•
Pivot Points is consist of 5 parallel line
•
Middle line known as pivot line and above two line from pivot line known as
resistance line R1 and R2, below two
line from pivot line known as support line S1 and S2
•
Whenever stock price cross the pivot line from below to above and make a close
above pivot line, it indicate that upward side movement is might be start in
particular stock
•
When stock start the movement upward side form the pivot line, Resistance 1
(R1) and Resistance 2 (R2) will be the probable resistance for that particular
stock where stock might face some difficulty to cross and trade above that line
•
Similarly whenever stock crossed pivot line from above side to below side and
made a close below pivot line it indicate that bearish sentiment might be start
in that particular stock
•
When stock start the movement down side from the pivot line, below two line
which know as S1 and S2 will be the probable support for that security and it
might get some difficulty to trade below that support line and it may bounce
back
•
For more accurate and refine result it is advisable to use pivot point with RSI
and Fibonacci levels
•
Pivot Point is comes under leading indicator because it gives in advance
support and resistance level of any stock or any security
for
more such type of education joint our online series and batches and be a pro
trader contact on 7028 421 786.
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