Pivot High/Low [s3]

27 дек. 2024 г.

This is a technical analysis tool that identifies significant price pivot points (highs and lows) in the market. It looks for both major and minor pivot points, which can help traders identify potential support and resistance levels, trend reversals, and breakout opportunities.

How Pivot Points Are Calculated:
The indicator uses a straightforward "higher than everything around it" or "lower than everything around it" approach:

For Pivot Highs:
- The indicator looks at a specific bar and compares it to bars before and after it
- For a major pivot high: It checks 50 bars to the left and 20 bars to the right
- If the bar's high price is higher than ALL bars within this range, it's marked as a pivot high
- Think of it like a mountain peak - it needs to be the highest point compared to everything around it

For Pivot Lows:
- Same concept but reversed - looking for valleys instead of peaks
- Checks the same ranges (50 left, 20 right)
- The bar's low price must be lower than ALL surrounding bars
- Like finding the bottom of a valley - it needs to be the lowest point in the area

Key Features:
1. Two types of pivot points:
- Major pivots (using longer lookback periods of 50 bars left, 20 bars right)
- Minor pivots (using half the lookback periods - 25 left, 10 right)

2. Visual elements:
- Triangle markers above/below bars for pivot points
- Dotted lines extending from pivot points
- Color coding: Green for lows (support), Red for highs (resistance)
- Major pivots are more prominent than minor pivots

3. Customizable alerts for:
- Formation of new pivot points
- Breakouts above/below pivot levels

Trading Applications:

1. Support and Resistance:
- Major pivot levels act as strong support (lows) and resistance (highs)
- Multiple touches of these levels increase their significance
- Minor pivots can indicate intermediate support/resistance levels

2. Trend Analysis:
- Higher highs and higher lows = Uptrend
- Lower highs and lower lows = Downtrend
- Breaking of major pivot levels can signal trend changes

3. Entry/Exit Signals:
- Long entries: When price bounces off major pivot lows
- Short entries: When price rejects from major pivot highs
- Take profits: At opposite pivot levels
- Stop losses: Just beyond the entry pivot level

4. Breakout Trading:
- Breaking above major pivot highs suggests bullish momentum
- Breaking below major pivot lows suggests bearish momentum
- Use the alert system to catch breakouts early

Settings Customization:
- Adjust lookback periods based on your timeframe
- Toggle visibility of markers and lines
- Customize colors for better visibility
- Enable/disable specific types of alerts

Risk Management Tips:
1. Don't rely solely on pivot points - combine with other indicators
2. Wait for confirmation of bounces/rejections before entering trades
3. Use proper position sizing based on stop loss placement
4. Consider market context and overall trend when trading pivot levels

This indicator is particularly useful for swing traders and position traders who focus on key market turning points and trend changes. It helps identify significant price levels where the market has previously shown reaction, making it valuable for both trend following and counter-trend strategies.