Dopo un breakout c’è sempre un throwback!!
Measuring The Markets With Pivots
A critical piece of the trading puzzle is determining which way price trend will go. Stating the obvious? Well, yes and no. Trend is a highly relevant term, pertaining to the timeline of a trade’s expected hold time on a clock and/or distance on a chart. Do we intend to exit quickly or intraday for relatively small to modest gains? Hold through market noise for bigger gains? Overnight or beyond several sessions for trend trade gains? By definition, an uptrend for one relative time frame can be a downtrend for smaller or larger time frames.
You can measure price action in many different ways. Moving averages, trendlines, and basic floor trader pivots are some of many popular chart tools for determining price direction or trend. Floor trader pivots are calculated based on the average of the high, low, and close of the previous trading day. They tend to be static.
Dynamic pivotsAnother chart tool many traders aren’t familiar with is what I refer to as dynamic pivots. The dynamic pivots price study measures any time period’s range from its low to its high (zero percent to 100%). Price measurement values are plotted at 25%, 50%, and 75% retracement levels from low (zero) to high (100) peaks of the range. You could also add midlevel marks at 38% and 62% as important Fibonacci values. These overall price tool values could be Fibonacci based or fractional numbers based. In other words, using 0-25-33-50-66-75-100 or 0-23-38-50-62-78-100 doesn’t seem to make much (if any) difference over a long period of time.
http://www.traders.com/Documentation/FEEDbk_docs/2010/07/Passamonte.html