Technical Analysis

Pivot Points — Definition & Example

Pre-calculated support and resistance levels for the current session, derived from prior session's high/low/close.

Pivot points generate a daily reference set: a central pivot (P), three resistances (R1, R2, R3) above, and three supports (S1, S2, S3) below. Calculated from yesterday's high, low, and close, they're standardised across most platforms — meaning many traders watch the same lines, which gives them self-fulfilling power. Often used by intraday traders for entries, exits, and risk levels.

Formula

P = (High + Low + Close) / 3; R1 = 2P − Low; S1 = 2P − High

Example

Yesterday: high 24600, low 24300, close 24500. P = 24466. R1 = 2(24466) − 24300 = 24632. S1 = 2(24466) − 24600 = 24332. Today's session is likely to react at these levels.

Related

SupportResistanceFibonacci Retracement

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