Structural Pivots Method (SPM)
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Structural Pivots Method (SPM) - Small Pivots
• In a rally, when we get 2 lower closes and lower lows, we get to mark Small Pivot High
(sph)
• In a decline, when we get 2 higher closes and higher highs, we get to mark Small Pivot
Low (spl)
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Structural Pivots Method (SPM) - Small Pivots
Concept of anchor/reference bar
Importance of creating rules objectively to mark the pivots
If rules are adhered, all will mark the same pivots
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Small Pivots – Rules for marking
Small Pivot High Small Pivot Low Common Rules
• To mark sph, we need two lower lows • To mark spl, we need two higher • Bar 1 & Bar 2 for marking small pivots does
and two lower closes compared to highs and two higher closes not have to be consecutive bars UNTIL WE
GET TO MARK THE SMALL PIVOT (HIGH OR
anchor bar compared to the anchor bar LOW)
• SPH is the highest point in between 2 • SPL is the lowest point between 2 • Anchor Bar or a reference bar is taken as a
SPLs SPHs starting point to compare high/lows
• SPH alternates with SPL • SPL and SPH alternate with each • Only Bar2 of prev marked pivot can ‘start’
other, SPL cannot follow another SPL acting as the anchor bar to mark the next
pivot
• Recently marked small pivot is temporary. It
becomes permanent only after marking the
subsequent small pivot.
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Structural Pivots Method (SPM) - Small Pivots
20
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Structural Pivots Method (SPM) - Small Pivots
Higher high and higher low SPs – SUT
Lower high and lower lows SPs - SDT
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Structural Pivots Method (SPM) - Large Pivots
Large pivots have specific set of rules to mark.
They can be used to define larger trends
LPs can be used for pure trend following (ride the trend till it bends)
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SPM Large Pivots – Rules for marking
• To mark LPH, we need to break the previously marked spl(temp spl break is enough)
• To mark LPL, we need to break the previously marked sph(temp sph break is enough)
• LPH and LPL alternates...
• To mark LPH, we go back to see all the sphs (that were marked after the last LPL – including
highs) and mark the highest sph as LPH
• To mark LPL, we go back to see all the spls (that were marked after the last LPH – including
lows) and mark the lowest spl as LPL
• Once marked, Large pivots are permanent (no temp pivot concept like spl/sph)
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Structural Pivots Method (SPM) - Large Pivots
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Structural Pivots Method (SPM) - Large Pivots
Higher high and higher low LPs – LUT
Lower high and lower low LPs – LDT
Pictures of stocks with Structural pivots marked – weekly
and daily
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