Weekly pivot influence on first trading day

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Originally posted by BruceM

...I have a friend who will only trade in the direction of the weekly pivot on the first trading day of the week....he uses it like a magnet...so for today he is only taking longs......his is by observation

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I'm curious about testing the general theory of this. I'm typing as I think...

If we took the week's first trading day's opening price and measured the number of points that it traded in the direction of the weekly pivot point and also the number of points it traded away... We might be able to measure a statistical deviance in the direction that it trades. Problems with this theory are (1) the market has an upward bias in the long term (i.e. not symmetrical (2) Market Profile theory can replace this because we are probably trading towards the weekly Point of Control which is likely to be near the weekly Pivot Point.

Testing is difficult because we need to compute the first trading day of the week in case it is a holiday and also count the number of trading days in the prior week in case of holidays. For example, last week we had 3 trading days in the E-mini S&P500 because of Gerald Ford's day of mourning. This was an unexpected holiday that is not on the calendars.

What I am thinking of is running a test to see if a rolling 5-trading-day pivot point has any influence on the direction of trade for any particular day-of-the-week. For example, are Monday's more likely to be days where the price is "drawn to that pivot like a magnet" rather than any other day of the week. That should be easier to test...

Starting 10/1 I kept track of the weekly moves on the ES, YM, NQ, and ER2. Wanting to take it a step further, I added the daily pivots starting this past week. This is what I have found thus far.

ES: Missed the weekly every day 10/1-10/5 and hit it Monday and Thursday this week. The daily pivot was traded to each day this week.

YM: Missed the weekly every day 10/1-10/5 and hit both the daily and weekly every day this week.

ER2: Hit the weekly pivot only on Monday 10/1 and Thursday 10/11. The daily pivot was traded to each day this week.

NQ: Over the last two weeks only traded to the weekly pivot on 10/11. The daily pivots were hit Wed thru Fri this week.

We'll see what this week holds. It should be an interesting week with 79 S&P and 13 Dow issues reporting earnings on top of the usual economic reports.

Hello Steve,

Great Work. Interesting observation about the daily pivot.

The ER took till Thursday to hit but it did. I found the ES and ER hit the weekly 98% of time and if not miss by 1-2 pts. If you take the DeMark pivot...it hits probably 99.9% of time.

Steve, as I wrote in an earlier post here on under looking for shorts, I do not use any indicators, sofware, trade rooms etc.

I do use a advisory service very cheap only $25 a month that tells me the change days...high or low area days. I then watch for these days and take a trade.I trade 1 carat for the long moves and 2 carats for short moves, 20 pts and 5-10 pts respectively ). I use the weekly pivot to trade down to or up to...depending if high days or low area days.

In the last post when I mentioned this, I did state people can email me and I will send out the guys link. I make no money from this..I'm not an affliate.

But his service is good and cheap...simple but effective. Now all I need is to become a better daytrader and I would make 5 times more...lol

email is [email protected]


This guy is very decent chap and the service is all I use to make my money. Even though I lose money on the reversals...i also make my targets.

Very Cool Steve,,,,It may be interesting to note how often we hit an r1,s1 or r2, s2 on the daily and weeklies too....I like how you are bringing this up to a new level....



We hit the Es weekly pivot on Monday this week...\\
Bruce

Thanks, Bruce. I haven't looked at the periodicities of hitting the S/R levels, but I like to see what happens when price opens at a certain level. For example, on the YMs, I notice that when the market opens at the R1 or S1 level, it is usually, not always, followed by a slow grind to the R2 or S2 respectively.

we've traveled 5 points under S1 on the weekly...this is a key point I believe down at this 39 area....I wouldn't be surprised to see a rally up from here... originally I thought we would pop up to 51 from the 45 area but now it seems that a push back to the Mon-Tuesday range at the 45 area may unfold....no signal for me to get long so without that I'm sidelined...

Weekly Es pivot was Hit on thursday this week...Traveled from a low in the 1493-1495 area to hit weekly pivot at 1528 area....

Thanks Bruce!

This is the first day since Monday of last week (10/15) that the ES and YM have traded to their weekly pivots. In fact, yesterday was the first day either of them hit their daily pivots since last Thursday. The ER2 has hit both the weekly and daily pivots each day this week. The NQ has pretty followed the Russell with the exception of Tuesday when it failed to trade to either pivot point. Of note, Tuesday was the only day since 10/15 that it did not achieve a pivot point.

As for what I make of this, thanks for asking , The ES and YMs are trading in tandem with respect to the pivots and the ER2 and NQ are demonstrating a high probability of hitting their pivots. Of course, this can change.

Well another exciting week has come and gone. Again this week, and for the 3rd consecutive week, the ES & YM traded in tandem with respect to trading to their respective weekly and daily pivots. The only day they hit their daily pivot was Fed Day on Wednesday, and the only weekly action was the following day. The rest of the time they didn't make it to the pivots. The NQ hit its daily pivot each day while missing the weekly for the entire week. The ER faired well having traded to the daily pivot each day except Thursday, and only hit the weekly on Wednesday and Thursday.

Thanks steve!

Absolutely! The past 4 months has enabled me to collect some good data and I will continue to do so. Very good exercise!