The central pivot point trading strategy is a popular method used by traders to identify potential support and resistance levels in the market.
The central pivot point is a key level that is calculated based on the previous day’s high, low, and close prices. The formula for calculating the central pivot point is as follows:
Central Pivot Point = (High + Low + Close) / 3
Once the central pivot point is calculated, traders can then use it to determine potential support and resistance levels for the current day’s trading.
The strategy involves using the central pivot point as a reference point for trading decisions. Traders may look to buy when the price is above the pivot point and sell when the price is below the pivot point. They may also use the pivot point to identify potential price targets or to set stop-loss levels.
Some traders also use additional pivot points, such as the R1 (first resistance) and S1 (first support) levels, which are calculated based on the central pivot point. These levels are seen as potential areas of price reversal or continuation, depending on whether the price breaks through them or bounces off them.
The central pivot point trading strategy can be a useful tool for traders to identify potential support and resistance levels in the market and make informed trading decisions based on those levels.
The central pivot point screening can be done using the Free Fatafat Intraday Stock Screener.