Using the Pivot Point Plug-in
The Pivot Point plug-in can be used simply to draw pivot points on a price chart. However the real power of the plug-in is in using the pivot point values within an Expert Advisor to make trading decisions.
One typical usage of pivot points is to use one of the resistance values as a breakout value for a BUY trade entry, and use the other pivot lines as a takeprofit target and a stoploss target.
For example:
- Resistance Level 1 is used as a price entry. Open a BUY order if the price goes above Resistance Level 1.
- Resistance Level 2 (or 3) is the used as the target takeprofit value;
- Support Level 1 (or 2 or 3) is used as the stoploss value.
This drawing illustrates a simple trading system that draws daily pivot points, collects the values for the Main, S1, R1 and R2, and opens a BUY trade if the Bid price breaks the Support 1 line.
The logical condition checks if the Bid price breaks the Support 1 line:
The fnOpenOrder function sets the takeprofit as R2 and the stoploss as S1.
