Pivot Point analysis has been a popular way of analyzing financial markets. These levels enable investors and traders to find potential support and resistance levels as well as possible reversal points to speculate on the trend direction. AtoZForex.com carefully analyses the market at the end of every month and provides monthly pivot points, support and resistance levels for five of the major currency pairs, Gold. For February we have also added EURCHF pair to our watch list as the pair moved massively after the SNB intervention on the 15th of January to eliminate the 1.20 EURCHF floor.
February Monthly Forex Pivot Points covers the following:
What are Pivot Points, Support and Resistance levels?
These are the price levels where the trend of the specified trading tool will stall or potentially touch & reverse.
You may also use the following manual calculation formula:
R2 = P + (H – L) = P + (R1 – S1)
R1 = (P x 2) – L
P = (H + L + C)/3
S1 = (P x 2) – H
S2 = P – (H – L) = P – (R1 – S1)
How to use point, support and resistance levels?
- Locate these levels on you trading platform
- Note the opening point of the market for the month
- Compare the new month opening to the Monthly Pivot Point (MPP), the opening of the market will give traders a clue about the trend bias for the month
- If the monthly opening price is above the MPP bullish bias are likely to be in action
- If the monthly opening price is below the MPP bearish bias will be preferred for the month
- This does not mean that traders should enter their positions based on the market openings. Generally price tends to pull back towards monthly pivot point before moving on the trending direction. The same phenomena appear for the daily pivot points and daily trend bias.
I want to get clear trend direction what should I do?
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