There are two types of pivots, tops and bottoms. These tops and bottoms can be defined by either using chart highs/lows or true highs/lows.
Each pivot has 4 levels for identifying highs and lows in the market: primaries, majors, intermediates and minors.
A top pivot is formed if the high price of the pivot bar is not violated by another bar during a set range ("x" bars) in either direction. The value of "x" is 27 for primaries, 19 for majors, 11 for intermediaries and 5 for minors.
Example: A primary pivot high is the highest point the market attained for at least 27 bars on either side of the pivot.
"X" bars are needed in the future direction to qualify a pivot. The program has a "guess" feature that attempts to label projected pivot points as accurately as possible but does not guarantee that they will not change. Any pivot that is labeled in the “guess” color (default: Red) will most likely be that type of pivot, but has met the conditions of a pivot of at least the next lesser degree. For example, if you see a Primary pivot labeled in the “guess” color, it will most likely be a Primary pivot, but has met the conditions of a Major pivot.
Pivots are labeled as:
P = Primary
M = Major
I = Intermediate
m = Minor
The default colors represent the following:
Blue = pivots
Red = pivots determined from guesses.
Pivot Parameters
•Color
•Hi/Lo: Determines whether chart highs/lows or true highs/lows are used to determine pivots. Chart highs/lows are determined from the current bar. True highs/lows are determined from the maximum/minimum of the current bar and the previous bar's close.