If you are a forex trade enthusiast, you must have heard about a pivot channel strategy indicator. As a participant in retail financial services, one way to ensure successful trading is to determine the actual pivotal points where the overall trend is most likely to reverse. However, you can’t do this without a pivot channel strategy indicator.
What is a Pivot Channel Strategy Indicator?
Pivoting is a major aspect of financial trading. Pivot points help you identify market movements, primarily based on the previous day’s low and high closing price. So, all you need is to check whether the market in the next session trades above or below the pivot point.
In this context, a pivot channel strategy indicator assists you in determining price movements in financial markets. Simply put, it helps you assess if the prices are bearish or bullish. (Try out indicators on Tradingview.com)
A market can either be bearish or bullish based on whether there is a negative or positive price movement. You consider the stock market bullish if the prices are above the pivot point, and if prices fall below the pivot point, you consider the market bearish.
You can calculate pivot points for various timeframes. If you have a charting software program, you can customize the indicator. For instance, some programs allow you to calculate pivot points for a monthly or weekly interval. However, you plot a standard indicator on a daily level.
Pivot Channel Strategy Indicator | Indicator Series Click To TweetAs a financial trader, your success largely depends on your ability to evaluate the patterns in trading data, and a pivot channel strategy indicator helps you do exactly that. This analysis tool works more like the On-Balance Volume or Average Directional Index. Traders use these tools to measure the momentum and strength of a trend, based on the direction the pricing is moving. (Look at the historical prices of several stocks and trading assets on Tradinview’s charts).
Why Should You Consider a Pivot Channel Strategy Indicator?
A pivot channel strategy indicator is one analysis tool that can give you a significant edge on the market. Here are five reasons to try it today:
- It is unique for day trading
- You can apply it to shorter time frames
- It is highly accurate
- The tool’s seven trading levels give you a rich set of data
- It is easy to use, even for beginners
In this context, a pivot channel strategy indicator can help you build consistency. With it, you are always sure where and when to enter and exit the trade, and how to place your stop.
The Bottom Line
If you have challenges identifying market movements, give the pivot channel strategy indicator a trial today. The tool effectively identifies whether a price falls below or above the pivot points, which is critical in making an informed trading decision. If you would like to learn more about leveraging technology to succeed in financial trading, contact DGM Tech Solutions.