CPR (CENTRAL PIVOT RANGE) INDICATOR METHOD OF TRADING TRICKS
As we all know one of the best methods of experienced and famous traders use pivot pont/ pivot trading (CPR-central pivot range method) or trick as their important strategy when they trade. It gives us to predict the market movement more accurately almost many times than other indicator or methods.
PIVOT POINT OF PIVOT TRADING COMPONENTS:
- Central pivot range
- Resistance
- Support
APPLICATION OF PIVOT TRADING:
TIME FRAME OF PIVOT PONT:
FORMULA FOR CPR CALCULATION
All the values are taken from previous day.
CENTRAL PIVOT RANGE:
Actually it derived from single pivot point in to three range of lines with respect to price of the stock.
PIVOT PONTS OF CPR:
TC = (Pivot – BC) + Pivot
Pivot point = (High + Low + Close)/3
BC = (High + Low)/2
RESISTANCE:
It is calculated from the above formula and it gives us resistance for particular day. Usually when marking in candle stick chart three resistance are drawn. say R1, R2, R3
R1=2*pivot point-low
R2=pivot point+(high-low)
R3=R1(high-low)
------------------------------------------------------------------------------------------------------------
R1- Usually candles will reach if market movement/volatility is average
R2-Usually candles will reach if market movement/volatility is good
R3-Usually candles will reach if market movement/volatility is super good.
SUPPORT:
S1=2*pivot point-high
S2=pivot point-(high-low)
S3=S1-(high-low)
------------------------------------------------------------------------------------------------------------
S1- Usually candles will reach if market movement/volatility is average
S2-Usually candles will reach if market movement/volatility is good
S3-Usually candles will reach if market movement/volatility is super good.
Note: No need to memorize the formula of CPR. Now almost all brokers providing chart platform contains this indicator. So no manual drawing. Just for understanding purpose give a glance to the CPR formula
WIDTH OF CPR PIVOT POINT METHOD:
This width of CPR applies to any stock and at any time frame
In any given day "longer the width of CPR, the shorter the volatility or shorter the momentum of the stock "
Increase in width of CPR= Low volatility of the stock
Decrease in width of CPR= High volatility of the stock
Methods or Tricks of CPR indicator:
It is completely based upon CPR for any given two consecutive days of market.
There are many websites which can give free of this CPR indicator tool in the charts.
We must use present day CPR and tomorrow CPR so that we get an idea how the tomorrow market will be. Based upon which you can choose the stock for tomorrow trade well in advance which you can gain profit in trading.
There are 7 types of prediction of next day stock by pivot point trading techniques.
- High level CPR
- Low level CPR
- overlapping high level CPR
- Overlapping low level CPR
- Out to In level CPR
- In to Out level CPR
- Unchanged level CPR
HIGH LEVEL CPR:
 |
| HIGH LEVEL CPR |
It helps us to predict that market will trade at higher points than previous day if there is good GAP UP of the first candle.
Always wait and confirm by looking at 2 and sometimes 3 candle to confirm the trend (up trend or down trend)
Book your profit at decent percentage (Don't wait all the day for huge profits- Markets may change the trend)
LOW LEVEL CPR:
 |
| LOWER LEVEL CPR |
It helps us to predict that market will trade at lower points than previous day if there is good GAP DOWN of the first candle.
Always wait and confirm by looking at 2 and sometimes 3 candle to confirm the trend (up trend or down trend)
Book your profit at decent percentage (Don't wait all the day for huge profits- Markets may change the trend)
OVERLAPPING HIGH CPR:
 |
| OVERLAPPING HIGH CPR |
It helps us to predict that market will trade at higher points than previous if there is good GAP UP of the first candle.
Always wait and confirm by looking at 2 and sometimes 3 candle to confirm the trend (up trend or down trend)
Book your profit at decent percentage (Don't wait all the day for huge profits- Markets may change the trend)
OVERLAPPING LOW CPR:
 |
| OVERLAPPING LOW CPR |
It helps us to predict that market will trade at lower points than previous if there is good GAP UP of the first candle.
Always wait and confirm by looking at 2 and sometimes 3 candle to confirm the trend (up trend or down trend)
Book your profit at decent percentage (Don't wait all the day for huge profits- Markets may change the trend)
OUT-IN LEVEL CPR:
Out to In CPR is formed when the entire CPR range of the current day is shrunk within previous day CPR range.
It helps us to predict that market will have good momentum either trade at higher points or lower points or swings between good high and good lows.
Always wait and confirm by looking at 2 and sometimes 3 candle to confirm the trend (up trend or down trend)
Book your profit at decent percentage (Don't wait all the day for huge profits- Markets may change the trend)
IN-OUT LEVEL CPR:
 |
| IN-OUT CPR |
In to Out CPR is formed when the entire CPR range of the current day is extended outwards from previous day CPR range.
It helps us to predict that market will have low momentum and hence the market trade at same level without decent high or low points.
In this scenario. don't do trade, just sit and watch the chart, That's it !!!
UNCHANGED LEVEL CPR:
Unchanged CPR is formed when the CPR range of the current day is duplicated or xeroxed as previous day CPR range.
It helps us to predict that market will have low momentum for the day and hence the market will trade at same level without decent high or low points.
In this scenario. don't do trade, just sit and watch the chart, That's it !!!
THUMB RULE OF CPR:
 |
| WIDTH OF CPR |
Higher the Width of CPR range- Lower the momentum
Lower the Width of CPR range- Higher the momentum
CONCLUSION:
As always market never follow any indicator, it applies to CPR indicator too. But the reliability of CPR PIVOT POINT / PIVOT TRADING TECHNIQUE has proven most of the time in market than any other indicator, it is good to adopt this CPR PIVOT POINT indicator in your pool of good strategy.
"LEARN, PRACTICE AND DO - SUCCESS MANTRA"
 METHOD OF TRADING TRICKS){kind=link}
0 Comments