Crypto Academy Season 2 Week 8 Homework Post for (@stream4u) - Technical Indicator: Pivot Points by @noraiz

Hello everyone! In this week lecture, we have studied about the pivot indicator. This is most frequently used indicator by the investors. This is my homework task for the @stream4u. So lets start it here.

1.Discussed your understanding of Pivot Points. (Title For this topic will be Pivot Points)

The crypto market is highly versatile. The changes occur every movement in assets price. The market some time goes up and other time the downtrend of market start. This market behavior urge the investors to analyze the market before making investment. The traders use multiple tool for technical analyses to predict the future of market. The pivot point is also an indicator which is being used while the technical analyses coins. The traders use this indicator to indicate the support and resistance level in the price movement of coins. This indicator help the investor alot for determining the market trend.

The pivot point is very simple and easy to implement. The traders use this for technical analyses because it is easily understandable. When a small movement in price of crypto currencies happen, then this indicator is used by investor for identification of support and resistance level. This indicator guide the investors even about the small movement in crypto price.

This indicator is apply on crypto chart and guide the investors about the market trend. The traders then decide whether or not they should invest money in crypto market. But as we know that an indicator cannot guide you perfectly all the time. Sometime it may mislead you and you may have lose because of that. So the investors use this indicator with combination of others while analyses. The highest, lowest and the closing price of any crypto is being used in pivot point indicator for determining the market trend.

Detail about Level of Pivot point

There are total three level of pivot point. We observe these level while using pivot point indicator for technical analyses of crypto currencies. As we know that pivot point use for identification of support and resistance level in the movement of price of any crypto. The mid of any pivot point chart is Main pivot point level. The above of this level is resistance. The support level lies below the main pivot point level.

Main pivot point: This point lies in middle of pivot point chart. This is main point of pivot point chart. The resistance level are there above this point and support level is there below this middle pivot point. The support and resistance level lines are shown on the chart of pivot point.

Support level

Support level 1- This is the first support level. This support level is lies on the first number below the main pivot point. At this level, the market is considered as at down trend. The price of asset fall at support level 1

Support level 2- This support level lies on the second number below the main pivot point. Here the bearish trend strat. The investors purchase the assets at low price

Support level 3- This support level lies on the third number below the main pivot point. Here the investors are also purchase assets at low price same as support level 2.

Resistance level

Resistance level 1- It is the first resistance above the main pivot level. At this level, the market trend change toward up
Resistance Level 2-  It is the resistance level above the main pivot level The resistance level start from this point. The price start rising. The investors that's why start selling the coin which they have holding. They sell the coins and earn very goof profit
Resistance Level 3- It is the resistance level above the main pivot level. This is the second level of resistance. Here the investors also sell the coin but the difference is this level is after the resistance level 2.

3.Pivot Point Calculation and R1 R2 S1 S2 Pivot Levels Calculation.

The pivot point indicator help us to indicate the market trend. The lowest, highest and closing price of previous day is used for calculation of pivot point. The closing, high and low price of crypto are added and then divide this addition by three is equal to the pivot point.

Low+high+closing price/3= pivot point.

Example

For example we have an asset with

closing price= $0.5
Highest price= $0.6
lowest price= $0.2

Pivot point = (0.5+0.2+0.6)/3

Pivot point= 0.433$

calculation of resistance level

resistance level 1= (2*pivot point) _ lowest price

Example:

Resistance level 1= 2*0.433 _ 0.2

resistance level 1= 0.6$

resistance level 2= pivot point + (highest price_ lowest price)

Example:

Resistance level 2= 0.433 + (0.6_0.2)

resistance level 2= 0.833$

calculation of support level

Support level 1= (2*pivot point) _ highest price

Example

Support level 1= (2*0.433) _0.6

Support level 1= 0.266

Support level 2=Pivot point -(High price _ low price)

Example

Support level 2= 0.433 (0.6_0.2)

Support level 2= 0.033

4.How to Apply Pivot Point on Chart. (Screenshot with tag your name)

Click on the coin you want to choose to apply the pivot point. I chosed bitcoin

Click on fx from the top line. Search for pivot point

The option related to pivot point will displayed in for of a drag down list. Chose pivot point standard from there.

The upper lines shows the resistance level and the lower lines are showing the support level.

You can even change the number of lines, font, size by selecting the setting section.

5.How Pivot Points Work. (Screenshot with tag your name)

The pivot point use the high, low and closing price of any crypto to indicate the market trend. If it shows that the price is above then main pivot point, this mean that the market uptrend is there. The price is rising. If the Price is below the main pivot point, this mean that the market downtrend is there. The price is falling.

In the above screen short, we can see that the price was above than main pivot point on 26 May. This mean that the market uptrend was there. Then, the price remain below the main pivot point from 27 to 30 may. The price fell and market was down trend. This bearish phase is best for investor for purchasing the coin at low price. Then price again go to above than main pivot point. This indicate market uptrend. MArket price raised. This uptrend remain there for two days.

The market uptrend give a signal to the investor to sell the coin for getting good reward. At June first, the market price again go below to main pivot point. The support level was there and market downtrend took place. The price fell down. On June 2 and 3, the price remain above than main pivot point. The price raised and market started uptrending.

When price of an assets go up from main pivot point, this position is best for investor to sell their holding coins. When the price of asset goes below from main pivot point, this position is best for investors to purchase the coins at low price. The support level indicate the bearish point and the resistance levels indicate the bull position in market.

6.Pivot Point Reverse Trading. (Screenshot with tag your name)

The crypto market is highly versatile. The market trend continuously change. If there is downtrend in market, it will start rising price after some time. If you see an uptrend then this mean that the price will start falling after this trend. The uptrend is best for selling the coins and downtrend is best for purchasing the assets at low profit.

If we start analyze the market of ethereum coin from the June first, we can see that the price was at the down from main pivot point. This mean that the market was at its downtrend on June 1rst. But we know that there is uptrend after every downtrend in crypto world. No trend can remain there for permanent. We knwo that the price will go rise so the bearish is best point to buy the coin at low price as we know that the market will goes up and selling then the coin we get you good reward.

After that, next day, the market start rising. The price goes up from the main pivot point. this indicate a market uptrend and best for investors to sell their holding. The market is rising so best point to sell your purchased coin as we know that after uptrend, market we goes down again.

7.What could be a common Mistakes in Trading with Pivot Points

No indicator alone can always give you 100% accurate result. The investors make many mistakes while using the pivot point indicator. These mistakes bring them in a situation of losing their money. Some common mistakes which the investor do while sing pivot point are:

Number 1: As we know that no indicator produce the 100% true result alone. So always use combination of two indicators. Use some other indicator with pivot point for more accurate result. The result will not be probably true if investor use the pivot point indicator alone.

Number 2: You cannot get reward in a small time. Experience and time make you a good investor. So don't be panic and hurry.

Number 3: The R1 and S1 do not support when the price reach to the maximum or minimum value. The resistance level 1 and support level 1 do not support strong buying or selling position

Number 4: The beginners should not invest before proper analyze. Only invest money even after analyze which you can offord to lose.

Number 5: Do not buy or sell the coin when you see that the asset price reach to the main pivot point. This is the point when trend start. The market will go to upward or downward. So wait and try to indicate the market trend rather than making a move when price reach to the main pivot point.

Number 6: There is need to check the volume of asset price rapidly and strictly in pivot point indicator.

Number 7: When the price reach up from the main pivot point, sell your invested assets

Number 8: When you see that the price reach to the support level and below from the main pivot point, then this is best time to buy the coin because the price of coin is low at this point so investors buy the coin at this point and sell when the price again reach up from the main pivot point.

8. What could be the reasons For Pivot Points is Good. Pros/Advantages)

It is most commonly used indicator which shows how much accurate it produce the result.

The traders make the predictions and decide whether or not they should invest. These prediction increase the profit ratio and decrease the lose ratio

It is very simple to understand and easy to implement. When the price reach up from the main pivot point, sell your invested assets. When you see that the price reach to the support level and below from the main pivot point, then this is best time to buy the coin because the price of coin is low at this point so investors buy the coin at this point and sell when the price again reach up from the main pivot point.

The pivot point indicator help the investor to get more reward. It reduce the lose ratio by indicating the support and resistance level. The last day price data is used in pivot point and help the investor to determine the trend of market.

The multiple support and resistance level in pivot point are useful for determining the upcoming market trend.

It can be used with other indicators. This compatibility increase the profit ratio.

This indicator is being used for long time which indicate its success rate in crypto market

9.Apply the Pivot Points indicator in the Today chart (the day when you making this task) and set the chart for 15 minutes. Explain the market trend till the time of writing the task and how it will be next till the end of the day. You can give possibilities on both the side bearish and bullish.

As we know that the steem is a crypto currency whose value was felling for last some weeks. The crypto coin was its downtrend.

In the above screen short we can see that The steem price is uptrending and downtrending every day. This is the bearish trend right now in the market. We can see in above screen short that the price is below from the main pivot point. Its mean that the price is felling down. It is going below the S1, S2, S3, S4,and S5. This is market down time but we know that no trend can be there forever. This will turn into the uptrend . The price will break the resistance level too after the bearish level break

10: Weekly Price Forecast of Ethereum.

Ethereum is the second largest crypto currency. It also work on decentralized blockchain.
The below is the trading view of Ethereum.

We can see that the price of ethereum was breaking the resistance level in May. The price was going up and it was bull period. The best time to sell the holded ethereum coins. This bull trend was there till the mid of May. After that the trend goes change. As we know that there is bearish period after bull trend. So the price started going down. This trend remain there for almost one week. Again price rise up and bull trend started again. A bearish and bull trend took place at the end of last month in ethereum market.

The above screen short is the weekly analyses of ethereum. We can see that the ethereum market is raising. The price is breaking the resistance level. It is felling for some time but rise again to resistance 4 and resistanec 5 level.

So we can say that this is the bull trend in ethereum market. But we know that after this trend, a bearish trend will take place in market.

Conclusion

The pivot point is an indicator use for technical analysis of any assets. We can predict the future of asset using this indicator. It is simple to use and easy ti implement and reduce the risk level to great extend when we use it with the other indicator. This indicator consider the support and resistance level. The last day closing, high and low value is used in this indicator for predicting the future of coin. The market is uptrending if price reach to resistance levels. The price is rising above from the main pivot point and this is the uptrend of market

When the price is below the main pivot point, this mean that it is going to the support level. At this time the market is at its downtrend. the price is falling. It alone don't produce 100% true result but when we applied this indicator combinning with some other indicator, it become more reliable.

Cc

@steemitblog
@stream4u