Extended Floor Trader Pivots

2020年5月20日

The Floor Trader Pivots indicator is a technical indicator that has long been used in the pits of exchanges. They define an equilibrium point called the primary pivot point or central pivot. Through much research, I can find no one to directly credit for establishing the original calculations which are used in this indicator. The original formulas calculate the primary pivot point (PP) and support/resistance levels based off the PP. Most pivot indicators only derive two support/resistance levels (R1, S1, R2, S2). This indicator provides the PP level as well as four additional support/resistance levels (R1-4, S1-4). This indicator also provides standard Open, High, Low, and Close levels. The calculations are as follows:

PP = (High + Low + Close) / 3
R1 = (PP * 2) - Low
S1 = (PP * 2) - High
R2 = (PP - S1) + R1
S2 = PP - (R1 - S1)
R3 = (PP - S2) + R1
S3 = PP - (R2 - S1)
R4 = (PP - S2) + R2
S4 = PP - (R2 - S2)

Pivot levels can be calculated for any time frame. This indicator provides Weekly, Monthly, Quarterly, and Yearly plots at each pivot level (PP - R4/S4).

This indicator can be used for a variety of different trading strategies and is widely used in equity markets, but can also be applied to Forex and Futures markets. It is most often used as profit taking/loss limiting levels as well as identifying possible areas for trend reversals.