CFDs Trend Indicators

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

This indicator is a very useful tool that use the previous bars' highs, lows & 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 cfd charts and price will bounce off one of these levels. These levels are used by traders to determine market tops, market bottoms or cfd trend reversals.

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

This indicator is shown below

Analysis in CFD 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 cfd market is bullish, and vice versa. However, pivot levels are short-term cfd 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 cfd 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 common techniques for utilizing them.

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

Price Breakouts: A bullish signal occurs when the cfd market breaks up through the central pivot points or one of the resistances (typically Resistance Level 1). A bearish signal occurs when the cfd market breaks down through the central point points or one of the supports (typically Support Level 1).

Trend Reversals:

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

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

Stop loss &/or Limit Profit Values Determined by Support/Resistance: This indicator might be potentially help-ful in determining suitable stop loss &/or limit profit placements. For examples, if trading a long break out above the Resistance 1 it might be reasonable to position a stop loss.

Combining with Moving Average Cross-over System

A good indicator to combine and trade reversal signals is the MA cross over which can be used to confirm the direction of a reversal cfds trade signal.

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

MA Crossover Strategy

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

To download this Pivot points Indicator:

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

Once you download it open it with MQL4 Language MetaEditor, Then Compile the indicator by pressing the Compile Button & it will be added to your MetaTrader 4.

NB: Once you add the indicator to your Meta Trader 4 Software, the indicator has extra lines referred to as Mid Points, to remove the additional lines open MQL4 Meta Editor(shortcut keyboard key - press F4), & change line 16 from:

Extern bool mid-pivots = true:

To

Extern bool mid-pivots = false:

Then Press Compile again, and the indicator will then appear as exactly highlighted on this web site.