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The following site has a good discussion of Pivot Analysis for
those of you who need an introduction. (I have no interest in the
site. Just came across it in my wanderings and found it to be
informative in this and several other areas for the uninitiated.)
http://www.oir.com/techind.htm#PA
It lists the formulas for computation of pivots as:
P = (H + L + C)/3
R2 = P + H - L
R1 = (2 x P) - L
S1 = (2 x P) - H
S2 = P - H + L
where:
P = Pivot value
H = Session high
L = Session low
C = Session settlement
R1= First Resistance
R2= Second Resistance
S1= First Support
S2= Second Support
And I believe it to be similar to prior postings.
Clyde Lee
Jonathan Stewart Dempster wrote:
>
> pivots are support and resistance levels,
>
> heres the formula use the previous days high, low and close figures.
> work out the pivot first, the rest follow from that. this is for daily
> support resistance, but you can use weekly h, l, c, data. etc..
>
> resistance 3 = (pivot - sup 1 ) + Res. 2
> resistance 2 = (pivot -sup. 1 ) + Res. 1
> resistance 1 = (2 x pivot) - low
>
> PIVOT = (high + low + close) divide by 3
>
> support 1 = (2 x pivot) - high
> support 2 = Pivot - (res. 1 - sup. 1)
> support 3 = Pivot - (res.2 - sup. 1)
>
> so calculate the figures put horizontal lines on your charts at all
> the points, apparently if prices trade above the pivot , its bullish.
> below bearish etc... just observe, it can be an eye opener.... traders
> (seek to drive prices ?) to these points, and others will come in from
> the sidelines and become buyers and sellers etc, thats the theory i
> think, and if we perhaps can understand how others will act at points, then
> we can take positions
>
> anyway they can be used as buy and sell zones, if prices collapse
> through a support then will they trade to the next support level. ? same
> applies to the upside, observe and see for yourself.
>
> perhaps spike highs and lows at the extreme points offer low risk
> opportunities ? maybe use another indicator to give weight of evidence
> perhaps as pring might say....., worth a look i think..
> J.D
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Clyde Lee Chairman/CEO (Home of SwingMachine)
SYTECH Corporation email: <clydelee@xxxxxxx>
7910 Westglen, Suite 105 Work: (713) 783-9540
Houston, TX 77063 Fax: (713) 783-1092
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