Weekly and Monthly Pivot Points

Until now, we have discussed only daily pivot point levels, but weekly and monthly pivot point analysis is also reliable and therefore popular. Swing traders mainly use pivot points based on weekly data, while position traders favour the monthly variety. These pivot points are derived from the same formula as daily pivot points but use the previous week’s or month’s high, low and close. Here are the formulae:

Pivot Point for current week (PP) = [High (previous week) + Low (previous week) + Close (previous week)] / 3

Resistance 1 (R1) = 2 x Pivot Point – Low (previous week)
Support 1 (S1) = 2 x Pivot Point – High (previous week)

Resistance 2 (R2) = Pivot Point + [High (previous week) – Low (previous week)]
Support 2 (S2) = Pivot Point – [High (previous week) – Low (previous week)]

Resistance 3 (R3) = High (previous week) + 2 x [Pivot Point – Low (previous week)]
Support 3 (S3) = Low (previous week) – 2 x [High (previous week) – Pivot Point]

Monthly calculation

Logically, the calculation for the monthly pivot points looks like this:

Pivot Point for current month (PP) = [High (previous month) + Low (previous month) + Close (previous month)] / 3

Resistance 1 (R1) = 2 x Pivot Point – Low (previous month)
Support 1 (S1) = 2 x Pivot Point – High (previous month)

Resistance 2 (R2) = Pivot Point + [High (previous month) – Low (previous month)]
Support 2 (S2) = Pivot Point – [High (previous month) – Low (previous month)]

Resistance 3 (R3) = High (previous month) + 2 x [Pivot Point – Low (previous month)]
Support 3 (S3) = Low (previous month) – 2 x [High (previous month) – Pivot Point]

The mid-pivot points are calculated in the same way.

Although different types of traders use various pivot point periods (daily, swing and position), an overlap between them makes a given price level much more robust and harder to break. Therefore, if a daily pivot point coincides with a weekly one, it is more likely to push the price back in its original direction on contact.