Pivot Points Trading Formula

Pivot Point (P) = High + Low + Close / 3

Resistance1 (R1) = (P * 2) - Low

Resistance2 (R2) = P + (High- Low)

Resistance3 (R3) = (P - S2) + R2

Support1 (S1) = (P * 2) - High

Support2 (S2) = P - (High - Low)

Support3 (S3) = P - (R2 - S2)

Where

High = High price from the prior trading day

Low = Low price from the prior trading day

Close = Closing price from the prior trading day

How to Calculate Pivot Points

After the share market closes or before it opens the next day, find the High (H), Low (L) and Close (C) from the most recent day.

Sum the High (H), Low (L) and Close (C) and then divide by 3

Mark this price on the chart as Pivot Point (P).

Once P is known, calculate S1, S2, S3, R1, R2, R3. The high and low in these calculations are from the prior trading day.