Pivot Points Energy Technical Analysis and Pivot Points Trading Signals
This energies indicator consists of a central pivot which is surrounded by 3 resistance levels below and 3 support levels above.
Initially these points were used by floor traders to analyze and trade the equities and futures energies markets. This energies technical indicator is considered to be leading rather than lagging.
Pivots provide a quick way for energies traders to analyze the general energies trend of how the energies market is going to be moving during the course of the day. A few simple calculations are used to draw the resistance and support levels.
To calculate these points for the coming trading day is the previous day's
- high,
- low, and
- close energies prices are used
The energies trading day closes at 5:00PM EST this daily market closing time is when the technical indicator is updated.
The 24-hour cycle for this indicator are calculated using a complex formula. The central pivot is then used to calculate the support and resistance areas as follows:
Resistance 3
Resistance 2
Resistance 1
Pivot Point
Support 1
Support 2
Support 3
Energy Technical Analysis and Generating Trading Signals
This energies indicator can be used in different ways to generate trading signals. The following methods are the most common technical analysis:
Energies Trend Identification Trading Signals
The central pivot is used by traders to determine the general market energies trend direction. The trades taken will only be in direction of the trend.
- Buy signal - energies price is above the central point
- Sell signal - energies price is below the central point
Energies Trading Price Break out Signals
Energies Price breakout signals are generated as follows
- Buy signal- is generated when the price breaks upwards through the central point.
- Sell signal- is generated when the price breaks-out downward through the central point.
Energies Price Breakout
Energies Price Reversal Trading Signal
Energies Price reversals are generated as follows
Buy Trading Signal- when price moves down towards one of the support area, then touches the support or moves slightly through it then quickly reverses and moves upwards.
Sell Trading Signal- when price moves up towards one of the resistance area, then touches the resistance or moves slightly through it then quickly reverses and moves downwards.
Energies Price Reversal Trading Signal
Setting Stoploss and Limit Profit Values
The central pivot and the other support and resistance zones are used by traders to determine suitable stop loss and limit profit levels.
Setting Stoploss and Limit Profit
If a buy is placed above the central point the Resistance 1 or Resistance 2 can be used to set the take profit level, and the Support 1 can be set as a Stop-Loss Energies Trading Order Level for the trade.
To download Pivot points:
https://c.mql5.com/21/9/pro4x_pivot_lines.mq4
Once you download it open it with MQL4 Language Editor, Then Compile it by pressing the Compile Button & it will be added to your MT4.
Note: Once you add it to your MetaTrader 4, the indicator has additional lines named Mid Points, to remove these additional lines open the MQL4 Language MetaEditor(shortcut keyboard key - press F4), & change line 16 from:
Extern bool midpivots = true;
To
Extern bool midpivots = false;
Then Press Compile again, & it'll then appear as exactly shown on this web site.
