CMA Final · Strategic Financial Management · Fundamental Analysis and Technical Analysis
A stock's previous session had High ₹520, Low ₹490 and Close ₹510. Using classical pivot point analysis, what is the first resistance level (R1) for the next session?
R1 is ₹523.33. The pivot is the average of high, low and close, which is ₹506.67. First resistance is twice the pivot minus the previous low, so 1,013.33 - 490 = ₹523.33.
- A₹523.33Correct
- B₹493.33
- C₹506.67
- D₹536.67
Explanation
Pivot P = (520+490+510)/3 = 506.67. R1 = 2P - Low = 1,013.33 - 490 = 523.33. 493.33 is S1 (2P - High), and 536.67 is R2 (P + High - Low).
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