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This scanner analyzes your securities looking for the set up that will allow you to trade the pivot point breakout system explained below.
Criteria:
- Security closed below the pivot point level of tomorrow
- Range between S1 and S2 is higher than 2%
Pivot point levels for tomorrow session are calculated based on today high, low and close prices.
The QuantShare formula for different support and resistance levels is as follows:
Range = (high - low);
PP = (high + low + close) / 3; // Pivot Point
R1 = 2 * PP - low; // First resistance
R2 = PP + Range; // Second resistance
R3 = PP + Range * 2;
R4 = PP + Range * 3;
S1 = 2 * PP - high; // First support
S2 = PP - Range; // Second support
S3 = PP - Range * 2;
S4 = PP - Range * 3;
The current screen is using only three variables: PP, S1 and S2.
After you get the list of stocks or securities that passed the criteria, you can implement the breakout system by monitoring these securities and entering short when the price closes below the support line S1 (breakout). Exit your position when the price reaches the second support line (S2). Place a stop order few points above the first support line (S1).
This screen displays two additional columns:
PP: Pivot point level
Range: The distance in percentage between S1 and S2
You can display the different pivot point levels on an intraday chart by using the following function: Floor Traders Pivots
Trading financial instruments, including foreign exchange on margin, carries a high level of risk and is not suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to invest in financial instruments or foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with trading and seek advice from an independent financial advisor if you have any doubts.
