The CPR (Central Pivot Range) forex indicator is an advanced tool designed to assist with daily price-level analysis by leveraging pivot points.
Pivot points are a popular strategy among forex and stock day traders to identify short-term support and resistance levels. They highlight key market areas where prices are likely to change direction.
The CPR indicator operates similarly to traditional pivot points but adds a unique approach by pinpointing critical price levels using the chart’s top, bottom, and central pivot points. Additionally, it plots a series of support and resistance lines based on daily, weekly, and monthly price actions.
Unlike most pivot indicators, CPR does not generate direct buy/sell signals. Instead, it identifies potential areas where significant changes in supply and demand might occur, providing trading opportunities. Understanding candlestick patterns can help anticipate likely trade signals at these key price levels.
Pivot points are a popular strategy among forex and stock day traders to identify short-term support and resistance levels. They highlight key market areas where prices are likely to change direction.
The CPR indicator operates similarly to traditional pivot points but adds a unique approach by pinpointing critical price levels using the chart’s top, bottom, and central pivot points. Additionally, it plots a series of support and resistance lines based on daily, weekly, and monthly price actions.
Unlike most pivot indicators, CPR does not generate direct buy/sell signals. Instead, it identifies potential areas where significant changes in supply and demand might occur, providing trading opportunities. Understanding candlestick patterns can help anticipate likely trade signals at these key price levels.
How CPR Indicator Works:
The CPR consists of three pivot levels: central pivot (PV), top central pivot (TC), and bottom central pivot (BC). The central pivot assesses the market sentiment:- Central Pivot (PV): Indicates bullish or bearish momentum. If the price stays below this level, it suggests bearish momentum and a possible sell opportunity.
- Top Central Pivot (TC) and Bottom Central Pivot (BC): Help determine price direction based on market sentiment. A price above TC indicates strong buy pressure, suggesting a potential buy opportunity.