Pivot Points

[bobcathy1]

Quote from kgharris:



Fibonacci is not complex. A few calculations is all you need. You can make a spreadsheet in less than 5 minutes to calculate the most common (and not so common) retracements and extensions.

Hmmm....could you post the calculations for us, it would be much appreciated!

 

[kgharris]

Quote from bobcathy1:



Hmmm....could you post the calculations for us, it would be much appreciated!

What do you want to do? Do you want the most common, or all.

.382
.500(*)
.618

Depending on what you are measuring, calculations are simple. For instance - high of 20, low of 10 - I want to know the 38.2% retracement off the low:

20 - 10 = 10
10 *.382 = 3.82
3.82 + 10 = 13.82

For extensions, I use 1.382 (*) and to a lesser extent 1.27.

For instance - high of 20, low of 10 - I want to know the 1.382% extension of the high:

20 - 10 = 10
10*.382 = 3.82
3.82 + 20 = 23.82

You can use whatever Fib #'s you want - you can get complicated and use them all or treat them like MA's and pick a few to stick with. I use the ones above - other #'s to consider are:

.786, 1.618, 2.24, 2.618, 3.14

And I am sure others can add their .02!

PM if you are interested in some good Fib Resources.

 

[saschabr]

http://www.equis.com/Education/TAAZ/?page=56

 

[bobcathy1]

I have one very basic question to ask.

Do you keep the retracements from previous days?
I see thes things called congestion zones.

Thanks for all the answers!

 

[rrs456]

I found the following resources very useful in the practical application of pivot points and Fibonacci numbers in trading:

1) Woodie's Pivot Points for TradeStation:
http://www.woodiescciclub.com
(see under the heading "Woodie's CCI Club -- Other Tools")

2) Fibonacci Calculator ( an useful, stand-alone, windows based program for calculating Fibonacci retracements and expansions. Price and other info available at the web site)
http://www.parttimetrader.com/

3) Moving averages and Fibonacci numbers in trading
http://www.tradethemove.com

4) A comprehensive trading approach based on Fibonacci numbers:
http://www.fibtrader.com

Disclaimer: Other than being a user of these resources, I have no connection with any of the sites mentioned above.

I hope you find them useful.

 

[ArchAngel]

Quote from bobcathy1:
I think he means fibonacci ratios....and Gann...
those are so complex you need a program to do them unless you are a math genius. And they are based on pivots anyway.

No - I didn't mean fibonacci ratios or Gann. And no, neither of those have to do with pivots (which are nothing more than some simplistic number tumbling of the previous day's high/low/close). Fibs are ratios of what you presume to be important or meaningful moves (but which may or may not be). Gann is somewhat more complex but essentially also presumes you've selected an important price period.

The locals and firms I worked with were concerned with understanding where intraday support and resistance was and couldn't have cared less about Fibs, or Gann, etc. - they used software that ran algorithms against the actual intraday trade data (not just the high/low/close of the day) to forecast important areas of support and resistance.

Considering that simple pivots have been around for over 40 years, it's kind of funny to see some retail traders who think they've discovered a "floor trader secret" or websites promoting pivots as such.

But it's always about what works for you anyway - not what someone claims is what someone or some group uses. Especially since even if what's claimed is true, you'd have to trade like that group for it to be meaningful.

 

[bobcathy1]

You are right in that ArchAngel, it is all in what works for you.
There are so many theories of how to trade, it is all in the practical application of it. And depends on what you are vehicle you are trading.

For what I do, indexes, plotting support and resistance is key. Often it is in just notes I make on my charts. Like ES has had a hesitation at 980 for a while now. That is not exactly a pivot, it is just what we see everyday.

Just a note on pivots, fibonacci, and Gann.....they are all approximate reference points, not exact ones. You need to remember that and not base your trading decision solely on the one indicator.

 

[bobcathy1]

Quote from rrs456:

1) Woodie's Pivot Points for TradeStation:
http://www.woodiescciclub.com
(see under the heading "Woodie's CCI Club -- Other Tools")

.

Thank you rrs456.....I really am getting a lot out of this particular site.