Camarilla Pivot Points is a more recent development, it's similar to standard pivot points but with an additional set of support and resistance levels (S3, S4, R3, R4) this method provides a greater number of potential levels of support and resistance. The calculation is based on the previous day's high, low, and close prices, and it uses a different formula than the standard pivot points.
Here's an example of how to calculate Camarilla Pivot Points:
Example:
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Yesterday's high = $100
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Yesterday's low = $90
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Yesterday's close = $95
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Pivot point (P) = (H + L + C) / 3
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Pivot point (P) = (100 + 90 + 95) / 3 = $95
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First level of resistance (R1) = P + (H-L) * 1.1/12
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R1 = 95 + (100-90) * 1.1/12 = $96.50
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Second level of resistance (R2) = P + (H-L) * 1.1/6
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R2 = 95 + (100-90) * 1.1/6 = $97
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Third level of resistance (R3) = P + (H-L) * 1.1/4
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R3 = 95 + (100-90) * 1.1/4 = $97.75
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Fourth level of resistance (R4) = P + (H-L) * 1.1/2
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R4 = 95 + (100-90) * 1.1/2 = $98.50
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A graphical representation of the pivot points would look
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First level of support (S1) = P - (H-L) * 1.1/12
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S1 = 95 - (100-90) * 1.1/12 = $93.50
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Second level of support (S2) = P - (H-L) * 1.1/6
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S2 = 95 - (100-90) * 1.1/6 = $93
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Third level of support (S3) = P - (H-L) * 1.1/4
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S3 = 95 - (100-90) * 1.1/4 = $92.25
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Fourth level of support (S4) = P - (H-L) * 1.1/2
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S4 = 95 - (100-90) * 1.1/2 = $91.50