Pivot Point Trading Strategy

Neostox02 Jul, 2024Finance

The pivot point trading strategy is a widely-used technique among traders to identify potential support and resistance levels in the market. It involves calculating a pivot point, which is the average of the high, low, and closing prices from the previous trading session. Traders then use this pivot point to determine key levels where the market is likely to find support (price levels where a downtrend may pause due to demand) or resistance (price levels where an uptrend may stall due to selling pressure). By analyzing these levels, traders can make informed decisions about entry and exit points, improving their chances of executing successful trades. This simple yet effective method is popular in various markets, including stocks, forex, and commodities.