Using Pivot Points When Trading the Emini's

Many times, active traders using short term strategies or scalping strategies, tend to look at very zoomed in charts, includng myself (1-2 min charts, tick charts). As these charts are our tools for our strategy, many times with such zoomed in charts, we tend to lose focus of the BIG picture, such as major psychological levels, VPOC's, 200 day MA's and so on. A lot of times, if you spend too much time worrying about all the different big picture levels, you might lose focus on your short term strategy and start second guessing your trades. Which is why I personally like to use Pivot Points. They help give me an idea of the big picture (for the day). I only look at this once when I start trading, whether we're above or below, and never really have to pay much attention to them, unless price action starts to approach a particular pivot level for the day. I've attached a Screenshot of yesterday's price action (5 min chart). As you can see, we spent most of the overnight session right by the Pivot Point, acting as major support on that level. If you trade premarket, you would have noticed a nice rally, right up to R1. If you were trading that, R1 would have been a great point to take profit, and sit aside and wait for a break or a bounce back to Pivot, or higher to R2. As 9:30 approached, we stalled a bit and headed higher, and hit R2 right on the nose. If you were scalping that rally as I was, R2 would be a great take profit for your core positions, and wait to see either a bounce or a break. Then came the big selloff around 2:30 which headed straight for the Pivot, hit it RIGHT on the nose and bounced right off. Great take profit areas.

I used a 5 min chart to demonstrate this, when I'm actually trading I'm typically using a 512 and 1600 tick chart, which is close to a 1 and 3 min chart, I do not see these pivot points, RI, R2 for most of the day. But they are on my charts, so when price action reaches these levels, I react and trade accordingly only when that happens, but I don't have to constantly keep aware of these levels, unlike, 200 day MA's, VPOC's and any other major levels you can come up with.