How to Use Pivot Points in Forex Trading

FX markets trade technically “purer” than stock markets… something which we are all very thankful for! By that, I mean price action reacts much better to resistance and support levels on a chart much better than equity markets do.

FX traders and dealers only have supply and demand to make their buy/sell decisions from. It’s all based on price levels, which is reflected in the charts. FX markets react better than stocks when it comes to Fibonacci tools, pivot points, trendlines and prior resistance – support levels, etc.

A lot of stock market price action is driven up, down or sideways by an endless procession of factors. Part of it is economic, part of it is fundamental to specific company, industry or sector. Another part of stock market action is pure emotion. Someone makes or sells a widget with perceived value higher than what turns out to be economic reality. Doesn’t matter… stock prices can remain pumped on pure emotion longer than rational people can comprehend. Read more about forex pivot point trading…