Beer points are referred to differently as trend reversal points. Popularized beer points legendary Wall Street trader Jesse Livymore. Translated from English, “beer” is “rotation.” Livymore called for similar pivot points to be sought, as a trend reversal should follow at the placement levels of these points. But it is known that the market reversal is the trader’s best friend.
The principle of operation of beer points
The principle of operation of beer points will be clear if you know formulas for calculating these turning points. But here the trader can get into a difficult situation. After all, there are several formulas for calculating beer points. What should I choose? There is a traditional formula for calculating turning points. This method has been successfully used by Wall Street speculators for several decades. We recommend using the traditional calculation method. The formula looks like this: P = (Maxim. value of Minim. value Close) 3. Additionally, calculations take into account the value of support levels (S) and resistance (R). S (resistance) = 2 * Beer – maximum. R (support) = 2 * Beer minimum. It is clear that nowadays no one manually produces these calculations, since high technologies have taken over all the work. It is possible to calculate beer points using the connection of special indicators. For example, a successful Beer indicator can be found in the familiar Metatrader program. But there is one nuance. Beer points should be configured for their individual work, for their own trade schedule. , For schedules up to 15 minutes, the data of the past trading day are applied. Last week data is used to 60. 30 minute schedules. The 1-day schedule assumes the application of data for the past month… Sometimes additional levels of support-resistance are also used. In this case, beer points are calculated like this: S2 is equal to Pivot minus (R-S). Further, R2 is Pivot plus (R-S). S3 is equal to Minimum-price minus 2 * (Maximum minus Beer), R3 is equal to Maximum-price plus 2 * (Beer minus Minimum-price). We recommend using the traditional principle of calculating beer points in our trade.
Beer point calculation formulas
Traditional calculation formula. The classical formula for calculating beer points has slight differences from the previous method. Woody’s formula, according to which a significant role in calculations is given to the closing prices of the previous trading day. The DeMark formula was developed by an analyst at the well-known SAC Capital Advisors fund. It was he who predicted the price excitement in the market in 2011-2013. Fibonacci formula beer points are calculated taking into account the lines of the famous mathematician of the Middle Ages. Camarilla, a method of determining turning points, which is also similar to the classical method. Trading with beer points, it is necessary to take into account volatility indicators. It is best to use the average value of volatility and abandon work in troubled markets during the period of publication of news.
Simple strategy of trading with beer points
Trading to break level, it is important to consider the presence of momentum-movement, presence of accompanying trend, growth of trade volumes. It is also important to take into account safety, stop loss and teak profile. Trade with Pivot points in the direction of trend movement, or in the other direction, if the price was able to pass about 80 percent of ATR. The signal must also be confirmed by closing above the level. Beer points are a classic long-lived indicator in trading. This indicator determines the level of reversal or correction. When using beer points, it is recommended use them in parallel with other indicators, such as Fibonacci levels. Record What are beer points and how to use them first appeared forex-for-you.ru.