Trading with market structure points selected by pivot points

The Key Points strategy

Most key price points in a chart are also market structure points (MSPs). Key points at which the market price turns, are perfect to open and close positions. This example shows both key price points (circles) and market structure points (V-shapes). Notice:

1. All key turning points are MSPs.
2. Most MSPs are not key points, and therefore not relevant.

Key price points are difficult to identify during the trading day. But... market structure points are easy to spot.

Conclusion? Traders need a reliable method to identify market structure points, which are also key price points.

Identify only the important market structure points

The Person Pivot strategy is the solution

To identify the MSP, which are also key price points, we use elements of an existing trading strategy. This trading strategy is called the Person Pivot trading strategy. We will use this strategy's pivot points to identify the important market structure points. How does this work?

The Person Pivot strategy calculates three essential pivot points. In addition, the strategy calculates a trend filter based on pivot points. The colour in the background of the chart indicates if the trend filter is bullish (green) or bearish (red).

This example shows the three pivot lines from the Person Pivot strategy. The special pivot filter colours the chart background green (bullish trend) or red (bearish trend).

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The trading signals

The Key Points strategy gives a buy signal when...

a Market Structure Low (MSL) point occurs on the lowest pivot line and the trend is positive.

This example shows a buy signal. The V-shape indicates a MSL point. The green chart background informs the trader the trend is positive. Only buy signals are shown.

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A short sell signal is given when...

a Market Structure High (MSH) point occurs on the highest pivot line, and the trend is negative.

This example shows a short sell signal. The reverse V-shape indicates a MSH point. The red chart background indicates the trend is bearish. Only short sell signals are shown.

Closing the positions

The Key Points strategy uses a profit target order, and a specific stop loss order. This stop loss order is called a periods-high-low stop. The NanoTrader platform automatically places both orders for you.

This example shows a long position. The position reaches the profit target and is closed with a profit.

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This example shows a short sell position. The position is closed with a profit when the market price touches the periods-high-low stop order.

Use this FREE trading strategy

Follow these steps in the NanoTrader Full platform:

1. Open the chart of the instrument you want to trade.

2. Select the "WHS Key Points" strategy in the "WHS Strategies" folder.

3. Activate "TradeGuard+AutoOrder" in the chart to trade semi-automatically or "AutoOrder" to trade automatically.

Open a trading account

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