Pivot Points

The pivot point represents a weighted average of the previous day's session since it is the average of the high, low and settlement. If the market rallies above the pivot point, for example, the market may be indicating some strength. A weak market would be suggested by a price move below the pivot point.

The pivot itself can be used as somewhat of a test price for the short-term trend.

Study Type: Overlay


Pivot points are used primarily as support/resistance numbers. Of the first pivot values, the pivot point itself is the best support/resistance level. The 1st and 2nd support/resistance levels have less reliability. All these pivot numbers are very popular on the exchange floors and are used by a significant number of traders. Pivot points are used in our technical indicators.