Mastering the Stock Market: High Probability Market Timing and Stock Selection Tools

CHAPTER 9

Pivot Point Analysis

So far, we have covered methods for determining trend direction using seasonal studies, the power of contrarian data using the Commodity Futures Trading Commission's Commitment of Traders (COT) report, and confirming tools and techniques such as comparative relative strength using trend-line analysis and moving averages. In addition, we covered how to view the overall health of the market with advance-decline (AD) work and volume analysis using the on-balance volume (OBV) indicator. We covered trading patterns with rules for entering and placing stops, as well as indicators and oscillators to help reveal markets hidden strengths like bullish convergence and weaknesses like bearish divergence.

I have discussed several research systems that can be used to scan for trading opportunities; Trade Navigator, TradeStation, and Thinkorswim by TD Ameritrade (yes, it is a coincidence that these platforms and trading companies all start with the letter T). I also showed a free Internet service using StockCharts.com. Here is another fact: Futures traders have been using my momentum indicator and Person's Pivots on the Open E-Cry (OEC) trading platform, and they are available with Ninja Trader. In the future, we may include these with E-Signal, Bloomberg, and Meta Stock, as there have been many requests to add these into those platforms. The reason my indicators have been so popular is that they have been instrumental in helping traders identify opportunities; ...