Anyone here trade off of Pivot Points? Is that possible? .. I mean, anyone use them? I mostly found them to be useless.
am sure hog, da king of tarocchi and mumbo jumbo will be able to help u..if u wish to attend, he's blabberin' his ta rock solid approach in chat all day long..he's borin' me to death, but u might like it and find it amusin'.
Almost useless! I tried using them for intraday S/R levels once and realized lunar and solar indicators prove to be more accurate. I started using the little sayings inside The Snapple cover to guide me throught the day with decent luck.
so, you're implying that they can be used to trade. But, there is no OBJECTIVITY to it. You pick 3,4 random pts from yesterdays prices and add/subtract to get 5,7 more prices. I mean.. there is NO SIGNIFICANCE to those prices. They are just points of reference for the sake of referencing.
pivot points are a tool yes, they are effective, but like any technique (fundamental or TA) they cannot be used blindly (imo) pivot points are areas that floor traders naturally gun for and they help identify areas where one will see price reversal or consolidation they are definitely useful i use them IN CONJUNCTION with market internals (nothing is more important than market internals for me) and predefined setups for entries and targets, and that is one of the ways i trade. floor trading pivots are useful. i also use Market Profile Analysis to find key price levels. these are also very useful but if u think using pivots means merely buying at S1 and selling at P, then u will not be an effective trader imo and btw, i find pivots work much better for some instruments than others. why? i have my theories, but that's largely tangential to the fact that u need to understand how a specific trading vehicle works (or doesn't) with pivots and develop trading setups with positive expectancy. pivots can help do that
"But, there is no OBJECTIVITY to it. You pick 3,4 random pts from yesterdays prices and add/subtract to get 5,7 more prices. I mean.. there is NO SIGNIFICANCE to those prices. They are just points of reference for the sake of referencing" false (i am referring to index futures). pivots were DESIGNED by floor traders, not some TA guru, as an easy on the floor method (since, especially back before laptops and hitech, floor traders did not have any computer access) to have key reference levels to gun for or fade if u understand how the floor dynamics work in terms of ebb and flow of orders, and pain/pleasure cycle of traders, you will understand why they work (for many index futures)
That was the first thing I tested when I was learning TS Easylang. and no, it doesnt work. Even tried to tweak the entries and stoplosses to death but still no dice. It was a good first code learning experience though, and also teaches you how effiecient and random the market really is
An interesting exercise is to markup the pivot levels onto a chart with overlaid volume profile. My impression is that volume tends to cluster just above or just below a pivot level to a greater degree than what one could expect if it were just random. This proposition could be backtested and would be a good starting point for investigating pivots. As Whitster stated pivots seem to be more applicable to some markets than others. I think they are particularly relevant to the asian futures markets.