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Pivot points

Trader's Glossary · Indicators

Pivot points

Definition. Levels calculated from the previous period's high, low and close, traditionally used by floor traders as reference points for the next day.

How it works

In the classic version, the central pivot P is the average of the high, low and close. The first resistance R1 = 2P − low, the first support S1 = 2P − high. Further levels are calculated similarly.

Example

Many participants see the same levels, because they're calculated from the same data using a simple formula.

What to watch out for

The result depends on whether they're calculated from the regular session or the full 24 hours. They're reference points, not levels that must work.

This is the session volume profile with VWAP in the Hetman Terminal (Battle Map of the Day). Screenshot from the Hetman Index (IHA) – a training instrument, simulated data.
This is the session volume profile with VWAP in the Hetman Terminal (Battle Map of the Day). Screenshot from the Hetman Index (IHA) – a training instrument, simulated data. See all the Hetman Terminal tools →

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See also

Support and resistance, Regular and overnight session, POC (Point of Control).

More in Hetman Capital Club

You'll find the full explanation with graphics, examples and exercises in the 📖 Order flow encyclopedia space, and its use in the live market in the 🔴 Live Room. Both are available to Club members (in Polish).

Educational content, not investment advice.