Bitcoin Pivot Points

Pivot points is a set of indicators developed by floor traders in the commodities markets to determine the potential turning points, also known as "pivots". These points are calculated to determine levels in which the sentiment of the bitcoin trend could change from "bullish" to "bearish." Bitcoin traders use these points as markers of support and resistance.

These points are calculated as the average of the high, low & close from the previous session:

Bitcoin Pivot Points = (High + Low + Close) / 3

Day traders use the calculated pivots to determine levels of entry, stops & profit taking, by trying to determine where majority of other bitcoin traders may be doing the same.

A pivot is a bitcoin price level of significance in technical analysis of a financial market that is used by bitcoin traders as a predictive indicator of bitcoin price movement. It's calculated as an average of significant bitcoin prices (high, low & close) from the performance of a market in the prior period. If the bitcoin prices in the following period trades above the central point it is usually evaluated as a bullish sentiment, whereas if bitcoin price below central point is seen as bearish.

The central point is used to calculate additional levels of support and resistance, below & above central point, respectively, by either subtracting or adding bitcoin price differentials calculated from previous ranges.

A pivot and the associated support & resistance levels are often turning points for the direction of bitcoin price movement in a market.

• In an up btcusd trend, the pivot point & the resistance levels may represent a ceiling level for the bitcoin price. If bitcoin price goes above this level the up bitcoin trend is no longer sustainable & a bitcoin trend reversal may occur.

• In a down bitcoin trend, a pivot point & the support levels may represent a low for bitcoin price level or a resistance to further decline.

The central pivot can then be used to calculate the support and resistance areas as follows:

Pivot points consist of a central point level surrounded by three support levels below it and three resistance areas above it. These points were originally used by floor traders on equity and futures exchanges because they provided a quick way for those traders to get a general idea of how the btcusd market was heading during the course of day using a few calculations. However, over time they have also proved exceptionally useful in other markets as well.

One of the reasons they are now so popular is because they are considered a "leading" (or predictive) indicator rather than a lagging indicator. All that is required to calculate the pivot points for the upcoming (current) day is the previous day high, low, and close bitcoin prices. The 24-hour cycle pivot points in this indicator are calculated according to the following formulas:

The central pivot can then be used to calculate the support & resistance areas as follows:

Resistance 3

Resistance 2

Resistance 1

Pivot Point

Support 1

Support 2

Support 3

Pivot Point Support & Resistance Areas

Pivot Point as a Bitcoin tool

The pivot point itself represents a level of highest resistance or support, depending on the overall sentiment. If the btcusd market is direction-less ( range bound ) bitcoin prices will often fluctuate greatly around this level until a bitcoin price breakout develops. Bitcoin Prices above or below the central point indicates the overall sentiment as bullish or bearish respectively. This btcusd indicator is a leading indicator that provides signals of potentially new highs or lows within a given chart timeframe.

The support and resistance levels calculated from the central pivot point & the previous market width may be used as exit points of the open Bitcoin trade transactions, but are rarely used as entry signals. For example, if the bitcoin price is up-trending and breaks through the pivot point, the first or second resistance level is often a good target to close a position, as the probability of resistance and reversal increases greatly, with every resistance level.

In pivot-point analysis 3 levels are commonly recognized above & below the central point. These are calculated from the range of bitcoin price movement in previous period & then added to the central point for resistances and subtracted from it for support areas.

Pivot Points

Pivot levels can be used in many different ways. Here are a few of the most commonly methods for utilizing them:

Bitcoin Trend Direction: Combined with other Bitcoin analysis methods such as overbought/oversold oscillators, volatility measurements, etc., the central point may be useful in determining the general trending direction of the market. Trades are only opened in direction of Bitcoin trend. Buy trade transactions occur only when the bitcoin price is above the central point & sell trade transactions occur only when the bitcoin price is below the center pivot point.

Bitcoin Price Break Outs: In bitcoin price breakouts, a bullish buy cryptocurrency signal forms when the bitcoin price breaks up through the central point or one of the resistance levels (typically Resistance Area 1). A short sell cryptocurrency signal occurs when bitcoin price breaks down through the center point or one of the support levels (typically Support Area 1).

Bitcoin Trend Reversals: In bitcoin trend reversals, a buy cryptocurrency signal forms when the bitcoin price moves towards a support level, gets very near to it, touches this point, or only moves slightly through this point, and then reverses and starts moving in the other direction.

To download Pivot points Indicator:

https://c.mql5.com/21/9/pro4x_pivot_lines.mq4

Once you download it open it with MQ4 Language Editor, Then Compile it by pressing the Compile Button & it'll be added to your MT4.

Note: Once you add it to your MetaTrader 4, indicator has additional lines named Mid Points, to remove these additional lines open the MQ4 Language MetaEditor(short cut keyboard key - press F4), and change line 16 from:

Extern bool midpivot = true:

To

Extern bool midpivot = false:

Then Press the Compile button again, & it'll then appear as exactly shown on www.tradebitcointrading.com web site.