How to Use Pivots Points for Day Trading

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

This commodity indicator is a very useful tool that use the previous bars' highs, lows & closings to project support & resistance levels for future bars.

This commodity indicator provides an idea of where key support and resistance should be. Place the pivot points on your commodity charts and commodities price will bounce off one of these levels. These levels are used by commodities traders to determine market tops, market bottoms or commodity trend reversals.

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

This commodity indicator is shown below

Technical Analysis in Commodities Trading

The central pivot itself is the primary level, which is used to determine the trend

The other support & resistance levels are also important in calculating areas that can generate significant market movements.

This commodity indicator can be used in 2 ways

The first way is for determining overall Commodities trend: if the pivot point is broken in an upward movement, then the commodity market is bullish, and vice versa. However, pivot levels are short-term commodity 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 commodity markets. This commodity indicator is a useful tool that can be used to calculate the areas that are likely to cause commodities price movement.

These points should be used conjunction with other forms of technical analysis such as Moving averages, MACD and stochastic oscillator.

This commodity indicator can be used in many different ways. Here are a few of the most common techniques for utilizing them.

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

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

Commodities Trend Reversals:

• A buy commodity signal occurs when the commodities price moves towards a support level, gets very close to it, touches it, or moves only slightly through it, and then reverses and moves back in the opposite direction.

• A sell commodity signal occurs when the commodities price moves towards a resistance level, gets very close to it, touches it, or moves only slightly through it, and then reverses and moves back in the opposite direction.

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

Combining with Moving Average Crossover System

A good indicator to combine and trade reversal commodity signals is the moving average crossover which can be used to confirm the direction of a reversal commodities trading signal.

An investor can then open an order once these 2 technical indicators give a signal in the same direction.

Moving Average Crossover Technique

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

To download Pivot points:

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

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

NB: Once you add it to your MetaTrader 4, the technical indicator has additional lines named Mid-Points, to remove the additional lines open MQL4 Meta Editor(short cut key-board key - press F4), & change line 16 from:

Extern bool midpivots = true:

To

Extern bool midpivots = false:

Then Press Compile again, and it will then appear as is exactly shown on this site.