Derivative Pivot HL Points

The Derivative Pivot HL Points indicator is a technical analysis tool designed to identify pivot high and low levels using a dynamic lookback period derived from market sentiment shifts. By adapting its calculation length based on the duration between trend changes, it offers a more responsive approach to identifying key support and resistance zones compared to static pivot indicators.

Usage

The indicator can be used to identify potential supply and demand levels where price action is likely to react. Because the pivot lengths are "derivative"—meaning they adjust based on the time elapsed between specific signal changes—the levels react to the current volatility and cycle of the market.

• Trend Identification: Use the pivot labels to identify higher highs or lower lows in a trending market.
• Support & Resistance: The price labels plotted at pivot points act as horizontal levels where price may find rejection or support in the future.
• Supply & Demand: Clusters of these dynamic pivot points often highlight significant areas of market interest.

Details

The script calculates pivot points by using a variable period length. This length is determined by the distance (in bars) between reversals in a specific trend condition logic.

The core logic tracks the crossing of price over previous swing highs and lows to determine a state of "expansion" or "reversal." The number of bars between these state changes is then fed into a custom pivot function. This ensures that in fast-moving markets, the pivots adapt to shorter cycles, while in slower markets, they respect longer-term structural points.

Settings

• Left Bars: Sets the number of bars required to the left of a high or low to initially identify a swing point.
• Right Bars: Sets the number of bars required to the right of a high or low to confirm a swing point.

FAQ

How do I interpret the labels on the chart?

The red labels appearing above price indicate dynamic Pivot Highs, while green labels below price indicate dynamic Pivot Lows. The value shown is the price at which the pivot occurred.

What makes this different from a standard Pivot High/Low indicator?

Unlike standard indicators that use a fixed "Lookback" period, this tool calculates its lookback dynamically based on the duration of recent market cycles, allowing it to adapt to changing market conditions.

How can I access the Derivative Pivot HL Points?

You can get access on the LuxAlgo Library for charting platforms like TradingView, MetaTrader (MT4/MT5), and NinjaTrader for free.