Tuesday, September 8, 2009

Forex Pivot Points

Professional traders & market makers use pivot point to identify important support & resistance levels.

Calculating Pivot Points
Calculated by using the last trading session's Open, High, Low & Close.

PP=(High+Low+Close) / 3
First level support & resistance
1st Support (S1) = (2*PP) - High
1st Resistance (R1)= (2*PP) - Low

Second level support & resistance
2nd Support (S2) = PP - (High - Low)
2nd Resistance (R2) = PP + (High - Low)


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