Here are some easy to memorize tips that will help you to make smart pivot
point trading decisions.
- If price at PP, watch for a move back to R1 or S1.
- If price is at R1, expect a move to R2 or back towards PP.
- If price is at S1, expect a move to S2 or back towards PP.
- If price is at R2, expect a move to R3 or back towards R1.
- If price is at S2, expect a move to S3 or back towards S1.
- If there is no significant news to influence the market, price will
usually move from P to S1 or R1. - If there is significant news to influence the market price may go straight
through R1 or S1 and reach R2 or S2 and even R3 or S3. - R3 and S3 are a good indication for the maximum range for extremely
volatile days but can be exceeded occasionally. - Pivot lines work well in sideways markets as prices will most likely range
between the R1 and S1 lines. - In a strong trend, price will blow through a pivot line and keep going
