How to trade a level
- 1
Wait for price to reach the level, not just approach it.
- 2
Look for a reaction: a rejection candle, a pattern, or an indicator turning at the level.
- 3
Enter in the direction of the reaction, with the stop just beyond the level.
- 4
Aim for the next level in the way, and check the distance first.
A close beyond the level, followed by a second candle holding beyond it, says the level has broken. A broken floor often becomes the next ceiling.
Questions traders ask
How are daily pivot points calculated?
The pivot P is the previous day's high, low and close added together and divided by three. R1 is two times P minus the low, and S1 is two times P minus the high.
Which pivot points are best for gold and US30?
Standard daily pivots are the most widely watched, which is what makes them react. Camarilla levels suit range days. WickSpeak lets you show whichever you prefer.
What is the difference between support and resistance and key levels?
Support is a floor price has bounced from and resistance is a ceiling it has turned at. Key levels are the specific prices where that tends to happen, such as pivots, the previous day high and low, and round numbers.
Can I use key levels in a strategy?
Yes. In Playbook a price level is a condition: price crosses, touches or bounces off a pivot, the previous high or low, the open, VWAP or an average range level.