CPR, or Central Pivot Range, is a key intraday indicator. In a previous newsletter, we explored its calculation and how it helps assess daily momentum. Today, let us delve deeper into this tool and learn to interpret intraday trends effectively.

Pivot Points: Key Levels in Trading

CPR has 3 components:

• Central pivot point (simply known as Central pivot)

• Bottom Central pivot

• Top Central pivot

Among the three components, the Central Pivot is the most significant. It is derived from the previous day’s High, Low, and Close, reflecting the prior day's volatility and market sentiment. This level often serves as a key support or resistance for the current trading session.

Pivot Points and day’s trend

One of my observations on candlestick charts is that the first candle on the 15-min chart is an important candle. When using the CPR for determining the day’s trend, we usually look at the first candle on the 15-min chart to determine the trend.

If the first candle closes above the Central Pivot, it is likely to be a bullish day.

If the first candle closes below the Central Pivot, it is likely to be a bearish day.

Observe the chart below of Nifty 50. The first 15-min candle closed below the Central Pivot on 24th, 27th, and 28th Feb 2025, indicating that it could be a bearish day.

Observe the chart below of INFY. On 13th Feb 2025 and 17th Feb 2025, the first candle on the 15-min TF closed below the Central Pivot. Those days, the price was bearish or slightly bearish. On 14th and 18th Feb, the price closed above the Central Pivot. Although the price initially declined, they had recovered by the end of the day, showing bullishness.

The chart below is of ASHOKLEY on 15-min TF. Observe that on 14th Feb, the first candle closed below the Central Pivot, and the price was bearish that day. But, the next two days, 17th and 18th, the first candle closed above the Cental Pivot and the price was bullish.

In the previous newsletter on this indicator, I had mentioned that this indicator in itself doesn’t have much accuracy. For example, in the ASHOKLEY chart, the first candle closed above the Central Pivot on 13th Feb but was still bearish.

To build a trading system with this indicator, it is essential to integrate other indicators and technical analysis concepts. I have covered this in detail in my course How To Trade Candlesticks on The Noiseless Trader platform. If you have not explored this course or others, consider TNT One subscription for access to a comprehensive library of trading resources.