A guide to using and setting up the OANDA Pivot Points indicator in MT4 to identify key support and resistance levels.
What is the OANDA Pivot Points indicator?
The OANDA Pivot Points indicator is a versatile tool that displays key pivot levels on your MT4 chart.
Pivot point analysis involves plotting six key levels — P (Pivot Point), S1, S2, S3 (Support levels), and R1, R2, R3 (Resistance levels) — calculated from the previous day’s high, low, and closing prices.
These levels help traders identify potential support and resistance zones, which are particularly useful for determining take-profit, exit, and stop-loss points.
Calculating pivot point levels
The following formulas are used to calculate each level:
- R3 = R1 + (Previous High − Previous Low)
- R2 = PP + (Previous High − Previous Low)
- R1 = PP + (PP − Previous Low)
- PP (Pivot Point) = (Previous High + Previous Low + Previous Close) ÷ 3
- S3 = S1 − (Previous High − Previous Low)
- S2 = PP − (Previous High − Previous Low)
- S1 = PP − (Previous High − PP)
Pivot point levels are widely used by day traders, as they indicate critical areas where price movement may reverse.
Configuring the OANDA Pivot Points indicator
From the settings menu for the OANDA Pivot Points indicator, you can configure the following parameters:
| Variable | Default value | Consideration |
|---|---|---|
| Timeframe for pivot points | D1 | Select the timeframe for calculating pivot points. Daily (D1) is standard, but other periods can be used. |
| Number of bars to include | 1 bar | Choose the number of bars (candlesticks) to include in the calculation. Typically, one bar is used, but multiple bars may be selected. |
| Calculation for PP level | HLC/3 | Choose the method to calculate the Pivot Point. The standard is HLC/3 ((High + Low + Close) ÷ 3), although alternative formulas are available. |
| Shows lines all the way across the chart | No | By default, lines are shown only for the selected day (on a daily timeframe). Select “Yes” to extend the lines across the entire chart. |
| Show labels for each line | Yes | Choose whether to display labels (names) for each line on the chart. |
| Bar offset for labels | 0 | Shift the line labels to the right by entering the number of bars to offset. |
| Font name for labels | Arial | Select the font style for the line labels. |
| Colour | - | Set the colour of each line. |
| Style | - | Define the line style (e.g., solid, dashed). |
| Show alerts | No | Enable or disable alerts. |
| Threshold for alerts | 0.0 | Set the threshold sensitivity for alerts. Positive values widen the threshold (alerts are triggered only after larger price moves), while negative values narrow it (alerts are triggered earlier). |
| Units for alert threshold | Pips | Specify the threshold unit in either pips or absolute values. |
This high level of personalisation allows traders to tailor the OANDA Pivot Points indicator to suit their trading strategies and charting preferences.
