57.1k views
0 votes
Pivot Points use the prior period's high, low, & close to estimate future support + resistance levels and are not leading indicators.

A) True
B) False

User Defhlt
by
7.5k points

1 Answer

3 votes

Final answer:

It is true that Pivot Points use past data to estimate future support and resistance levels and are therefore classified as lagging, not leading, indicators in trading.

Step-by-step explanation:

Pivot Points are indeed used to estimate future support and resistance levels in trading by taking the previous period's high, low, and close into account. This statement is true: Pivot Points are not leading indicators; they are considered to be lagging indicators because they use historical data. A leading indicator, by contrast, is meant to forecast future events and tend to signal future movements before they occur.

User Jonathan Maddison
by
6.5k points