Forex Pivot Points

As mentioned in a previous post, forex pivot points are a popular method used by the forex" rel="tag">forex traders trading in foreign exchange to determine hidden support and resistance levels for foreign exchange currencies.

Forex Pivot Points are support and resistance levels that are calculated using the open, high, low, and close prices, from the previous day’s trading. These prices are normally taken from a currency’s daily trading chart:

Legend:
Y = Yesterday
PP = Central Pivot Point
R1 = First Resistance
R2 = Second Resistance
S1 = First Support
S2= Second Support

PP = (YHigh + YLow + YClose) / 3
S1 = (PP * 2) – YHigh
S2 = PP – (YHigh – YLow)
R1 = (PP * 2) – YLow
R2 = PP + (YHigh – YLow)

It is common practice to calculate two forex pivot points support and resistance levels. Some analysts calculate a third support (S3) and resistance (R3) level but this latter calculation is not always useful in trading strategies.

Download your own desktop Pivot Point Calculator. Just Right click on the Pivot Point icon and select ’save target as’

Once you have downloaded the file, copy the .exe to your desktop and unleash the power of this dynamic tool. You will now have your very own Pivot Point Calculator at your fingertips. You may want to pass this on to your friends. That’s great, mail it to them. But don’t forget to tell them that you got it from:

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