Pivot Trading - Page 969 @ Forex Factory

Fibo Quantum

Pivot Trading - Page 969 @ Forex Factory

Hello guys,

Pivot Trading - Page 969 @ Forex Factory

One other replace. I’ve computed 5 years value of pivots for EURGBP and have counted the variety of instances pivots and S/R have been hit. Output is under:

Pivot Trading - Page 969 @ Forex Factory

Connected Picture (click on to enlarge)

Pivot Trading - Page 969 @ Forex Factory

Click to EnlargeName: EURGBP 5 Year Pivot probs.jpg
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So find out how to interpret this… Weeks hit S/R is straight ahead. The quantity of weeks in that 12 months that any S or R was hit. Under that’s the chance of S/R being hit provided that the earlier S or R was hit. So for instance, fifth 12 months R5 is 33% as a result of the earlier R4 was hit three instances and just one time did the value hit R5 so 1/three = 33%.

Pivot Trading - Page 969 @ Forex Factory

On the backside is the sum of all of the years and a sum weighted chance which accounts for the frequency pivot is hit because the additional out you go, the much less situations you get of S/R being hit.

Pivot Trading - Page 969 @ Forex Factory

There are numerous methods of decoding this data and it could be good to take a look at this whereas taking a look at a 5 12 months chart to see what the pivots do when 1 12 months value motion is barely in 1 path and so forth.

Pivot Trading - Page 969 @ Forex Factory

A few observations:

If we have a look at the sum weighted chance on the resistance aspect, if R1 is hit, it’s extra probably that R2 shall be hit. If R2 is hit, then R3 is simply across the nook with an opportunity of 75%. Discover this on the assist aspect aswell. It’s because the gap from zero.62 to zero.786 is mostly small and value can journey pretty rapidly by way of this space. If value hits R3 then there’s nonetheless a excessive likelihood of R4 being hit(70%). After that there’s a sudden drop to R4. Which means that it is pretty secure to start out opening shorts between 1.00 and 1.38 with a cease above the 1.38 pivot. If R5 is hit, then it’s extremely probably that R6 and R7 will then be hit.

What I discover fascinating is that the pivots are pretty constant all through the 5 years with the upside operating far above R6 and R7 when value hits R5 whereas on the draw back, S6 and S7 are much less predictable and by my interpretation would not appear to run as far. The drop at R5 is pretty constant too.

The assist aspect would not look too fascinating for this pair however the identical story goes. After value hits S3, it’s nonetheless extra probably than not that S4 shall be hit however chance of this occurring reduces.

If the value is between S1 and PP, then there’s a 68% likelihood that S1 shall be hit.

This information can be utilized to commerce with the pivots. e.g. if R1 is hit, then it could be extra probably that R2 shall be hit, then R3 adopted by R4. So the plan may very well be to attend until R1 is hit, if it retraces a bit, enter an extended place under R1 and have a cease under pivot(observe, these chances do not imply that if value is at R1 that it’s unlikely that the value will fall under pivot. It simply signifies that in a given week, if R1 is ever hit, R2 has a 66% likelihood of being hit. In between, value could hit S3 after which come again to hit R2). We will then exit our lengthy place as PA loses steam and begins stalling ideally at R4. Then shorts will be open.

I will cease right here as I have been rambling on for some time now.

In the event you see any flaws in my logic and interpretation please let me know as I am pretty open and need to produce one thing that’s strong and foolproof.


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