FAQs Frequently Asked Questions
Dr. Chris Kacher created the pocket pivot in 2005 when the sideways choppy markets of 2004-2005 were making base breakouts fail. What does not kill you makes you stronger, and the pocket pivot concept was born.
The pivot point is taken in context with the overall chart. With base breakouts, this is less so but is still contextual. For example, with some bases, you can draw a downward sloping line and this would serve as your breakout point. In other bases, it is when the stock hits a new high that is the reference point. Still, with some bases, it is the high of the handle rather than the high of the overall base that is the reference point.
With pocket pivots, the pivot point is often the closing price of the day on which the pocket pivot occurs. In cases where it coincides with a base breakout, the normal breakout point (new high, high of handle, or downward sloping line) would usually be the point of reference. Note, if the stock had a huge up day, one must factor this into their own risk tolerance levels as such a stock could potentially pull back by a greater amount.
|First published:||6 Jan 2011|
|Last updated:||12 Apr 2012|