Today is a 14th day when EUR/USD is below the daily pivot point. What can we learn from that?
Of course, a strong sell-off is obvious here even without Pivot Points. Still, we can use Pivot Points even is such a strong trend moves like that.
1. We can reenter trade during a correction. Almost each correction up ended at the daily pivot and that was the best place to open a short position and enter the trend.
2. We can hunt for the end of the move down or a slowdown and open a reversal trade. To do that we want to see the price going above the daily pivot point and ideally correcting down, finding support at the daily pivot and moving up. In other words, we want to see a daily pivot working as a support. This should give us a good entry with a tight stop loss.
So something like this:
So you can see exactly how pivot line started to work as a support – there was move up, correction to pivot line, support, and start of trend up.
It is important to wait for candle close. If you have confirmation from candles then you open trade.
Right now on eurusd we saw 2 or 3 days when the price went above the daily pivot line but notice that there was no support from it. Price went easily below it and continued to move in a downtrend.
Now we can observe some slow down – we should keep our eys on that daily pivot and watch how price will react with it.
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