I am always curious to know about stock exchange and how price of any stock changes. I always wonder that how market analysts can predict prices. I was googling and I found one Pivot Points method to predicte prices. I never tried this method but It is always interesting to know such method. We can try to just see how it goes with real market.

• Method #1: Five Price Points Pivot Method. There are five equations as below,

R2 = P + (H – L) = P + (R1 – S1)
R1 = (P x 2) – L
P = (H + L + C) / 3
S1 = (P x 2) – H
S2 = P – (H – L) = P – (R1 – S1)

Here,
S = Support Levels,
R = Resistance Levels
P = Pivot Point
H = High
L = Low
C = Close
Note: The high, low and close in 24-hour markets.

• Method #2: P = ((Today’s O) + Yesterday’s (H + L + C)) / 4

Here,
O = Opening Prices. Support and Resistance Levels can be calculated by equations of Method #1.

• Method #3: Developed by TomDeMark.

Here,

Condition	Calculation	Tomorrow’s Projections
Today’s Close < Today’s Open	X = (Today’s High + Today’s Low + Today’s Close + Today’s Low)	High = X/2 – Today’s Low Low = X/2 – Today’s High
Today’s Close > Today’s Open	X = (Today’s High + Today’s Low + Today’s Close + Today’s High)	High = X/2 – Today’s Low Low = X/2 – Today’s High
Today’s Close = Today’s Open	X = (Today’s High + Today’s Low + Today’s Close + Today’s Close)	High = X/2 – Today’s Low Low = X/2 – Today’s High

Interpreting and Using Pivot Points
When calculating pivot points, the pivot point itself is the primary support/resistance. This means that the largest price movement is expected to occur at this price. The other support and resistance levels are less influential, but may still generate significant price movements.
Pivot points can be used in two ways. The first way is for determining overall market trend: if the pivot point price is broken in an upward movement, then the market is bullish, and vice versa. Keep in mind, however, that pivot points are short-term trend indicators, useful for only one day until they need to be recalculated. The second method is to use pivot point price levels to enter and exit the markets. For example, a trader might put in a limit order to buy 100 shares if the price breaks a resistance level. Alternatively, a trader might set a stop-loss for his active trade if a support level is broken.

PS: I have used Yahoo! Finance and Investopedia for my references.