Camarilla Pivot Points

Camarilla Pivot Points were developed in 1989 by Nick Scott, a bond trader. Unlike Classic pivots, which spread levels widely, Camarilla generates tighter, closer levels that often sit near the current market price. This makes them highly effective for intraday reversals and breakouts. The system uses eight levels (H1–H4, L1–L4), of which H3/L3 and H4/L4 are most commonly traded.

💡 Key Highlights & Market Suitability

• Provides frequent support/resistance touches, giving traders more opportunities.
• H3/L3 → reversal levels, where price often stalls and reverses intraday.
• H4/L4 → breakout levels, signalling strong trend continuation.
• Best suited for intraday and options trading, especially in volatile indices like Nifty/Bank Nifty.
• Favoured by scalpers and intraday traders who need constant levels.
• Less effective in low-volatility or flat sessions, where levels remain untouched.

📊 Formula

• Resistance Levels:
  • H1 = Close + (High – Low) × 1.1 ÷ 12
  • H2 = Close + (High – Low) × 1.1 ÷ 6
  • H3 = Close + (High – Low) × 1.1 ÷ 4
  • H4 = Close + (High – Low) × 1.1 ÷ 2
• Support Levels:
  • L1 = Close − (High – Low) × 1.1 ÷ 12
  • L2 = Close − (High – Low) × 1.1 ÷ 6
  • L3 = Close − (High – Low) × 1.1 ÷ 4
  • L4 = Close − (High – Low) × 1.1 ÷ 2

👉 Traders mostly focus on H3/L3 and H4/L4.

🧩 Market Condition

• Price near H3/L3 → likely reversal zones.
• Price breaking H4/L4 → trend continuation breakout.
• Price oscillating between H3 and L3 → range-bound market.

🎯 Trading Strategies with Camarilla

1. Reversal Strategy (H3/L3)

   • Setup: Price approaches H3 (resistance) or L3 (support).
   • Entry: Enter short at H3 if price stalls; enter long at L3 if price bounces.
   • Stop-loss: A few points beyond the level (H3/L3).
   • Target: Pivot point or opposite Camarilla level.
   • Best Use: In sideways or mean-reverting sessions.

2. Breakout Strategy (H4/L4)

   • Setup: Price breaks above H4 or below L4 with volume.
   • Entry: Enter after breakout candle closes beyond H4/L4.
   • Stop-loss: Just below H4 (for longs) or above L4 (for shorts).
   • Target: Next Fibonacci extension or continuation level.
   • Best Use: In volatile, trending markets.

3. Range Strategy (Between H3 and L3)

   • Setup: Price oscillates inside H3–L3 band.
   • Entry: Buy near L3, sell near H3.
   • Stop-loss: Small buffer beyond the band.
   • Target: Opposite side of the band.
   • Best Use: In low-trend, sideways markets.

📋 Quick Reference Table

✅ Summary

• Camarilla is the most actionable pivot system for intraday option traders.
• Levels are close to price → frequent reactions, ideal for scalping.
• Works best when combined with CPR (for bias) → CPR tells you trend direction, Camarilla gives precise entry/exit levels.