In today’s article, I’ll show you how we use the Hawkeye Pivots on crude oil charts to illustrate their value to enhance your trading.
Monthly Chart Analysis
If you look at the right side of the monthly chart above, you’ll see there’s a red arrow pointing down. While not part of our software, the red arrow shows the first time price closed under the pivot low extension (that’s the yellow line that’s coming off the last true isolated low).
This breakout was on the 31st of October 2014, and Hawkeye showed the new trend has commenced with red selling Volume, a bright red Heatmap, and declining red Trend dots.
Weekly Chart Analysis
Now, let’s look at the weekly chart.
Notice where the red arrow is again. That is where the breakout occurred, when price closed under the last isolated low pivot extension. From there, you can see that the prices are falling and that no pivot has formed all the way down. However, now we are getting to a potential pivot low, and you can see some green buying volume has come in on the weekly chart on the last bar. Keep that in mind as we now move on to the daily chart.
Here, you can see I have placed a cyan arrow pointing upwards showing us the new pivots and the extension lines (high and low), which are the two yellow lines extending to the right. Notice that the trend dot has gone flat, that the price is going sideways, and that the volume is declining.
(By the way, ignore the current bar, because that was Martin Luther King’s birthday, and the markets were closed at that time.)
Now, notice how on the Roadkill indicator we see two bars of green buying volume coming in. That means, we are hitting a point of congestion on our crude chart. We will only know if that pivot low is taken out if it continues down, and price is at 4455.
Therefore, if we close below the pivot low at 4450, then the downtrend will resume. But, if the pivot high is taken out, which is at 5175, then we will be in a daily uptrend. The bias at the moment is still down, but we are getting congestion bottoms forming, hinting that upwards price action is a possibility.
So, I hope you’ve enjoyed seeing how we use the Hawkeye Pivots. Understanding price action with the underlying Volume is the true advantage in trading. The Hawkeye Pivots is a unique tool that helps us put it all together.
We teach this and many other methods in our live training room held every Wednesday. Click this link for more information or to join us in class.
Please contact us at [email protected] for any questions you might have about using Hawkeye Indicators in your trading!
[The red and cyan arrows are for illustration only and do not form part of the software]