CPR (Central Pivot Range) Trading Strategy: Understanding Market Structure

The CPR (Central Pivot Range) trading strategy helps traders see how the market is moving in a clear and simple way. It shows important levels where the price might stop going down or stop going up. This makes it helpful for traders who buy and sell within the same day and want an easy tool that is not confusing.

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What is the CPR Trading Strategy?

The CPR is made using the previous day’s high, low, and close prices. These numbers help create three levels: the Pivot Point, the Top Central level, and the Bottom Central level. Together, they form a range that shows how the price might react. This simple structure helps traders focus on real price movement instead of getting confused by extra information.

How to Calculate CPR Levels

You can calculate the CPR levels using the previous day’s high, low, and close prices. These values help you create the three main levels that form the Central Pivot Range.

Pivot Point (P)
P=(High+Low+Close)/3
Bottom Central Level (BC)
BC=(High+Low)/2
Top Central Level (TC)
TC=(P−BC)+P

These three levels together form the CPR and help traders understand potential support, resistance, and market structure for the next trading session.

How CPR Reflects Market Structure

When the price goes above the Top Central level, it usually means the market is strong and buyers are in control. When the price falls below the Bottom Central level, sellers become stronger and the market often becomes weak. If the price stays inside the CPR, the market mostly moves sideways, and traders wait to see if it will break out in any direction. This simple pattern helps traders understand whether the market will trend or stay in a small range.

Role of Virgin CPR Levels

Virgin CPR levels, which remain untouched from the previous session, often act as strong support or resistance. These levels attract attention because the market respects them more often, and this behaviour helps traders plan their entries and exits with clarity. This makes Virgin CPR a reliable part of the CPR trading strategy.

Using CPR with Other Signals

The CPR works best when paired with price action and volume. These elements offer a fuller picture of momentum and prevent traders from reacting to false moves. CPR does not predict the market, but it provides clean structure and improves decision-making.

Conclusion

By using the CPR trading strategy to understand how the market moves, traders can make intraday decisions with more confidence. It keeps the analysis easy, helps them stay disciplined, and gives clear levels that make choosing what to do much simpler.