Levels & geometryCamarilla Pivot Points · Camarilla
Eight levels packed tightly around the prior close — designed for mean-reversion at the third band and breakouts at the fourth.
Works best in ranging marketsEngine-computed on a fixed sample series
What it is
Camarilla pivot points are a set of intraday support and resistance levels calculated from the previous period's price action, designed specifically to give day traders precise lines for fading reversals and catching breakouts. Developed by Nick Scott in the late 1980s, the system projects eight levels — four resistances and four supports — clustered tightly around the prior close, which is what distinguishes it from wider pivot systems. It answers the practical question of where price is likely to stall and reverse during the day, and where a decisive break signals a trend day instead. The tight inner levels are built for mean-reversion, while the outermost band is built for breakouts. Because the levels are computed once from yesterday's data and then held fixed all day, they give a trader a ready-made map before the session even opens. They are most popular among intraday equity and futures traders.
How it's calculated
Camarilla anchors everything to the previous period's close and scales the levels by the previous period's range, the prior high minus the prior low. Each level is the close plus or minus the range multiplied by a specific fraction, with the four key multipliers being 1.1 divided by 12, 1.1 divided by 6, 1.1 divided by 4, and 1.1 divided by 2. So the third resistance, H3, equals the close plus the range times 1.1 over 4, and the fourth resistance, H4, equals the close plus the range times 1.1 over 2, with the supports L3 and L4 mirrored below the close by the same amounts. Because 1.1 over 2 is much larger than 1.1 over 12, the outer H4 and L4 band sits far wider than the tightly packed inner levels. Some versions extend the set with a fifth pair, computed from the ratio of the prior high to the prior low times the close, but the classic system is the eight levels around the close.
Reading it step by step
The two levels that matter most are the third and fourth bands. The third band, H3 above and L3 below, is treated as the reversal zone: price poking into H3 and stalling is the classic setup to fade back down, and price dipping to L3 and holding is the setup to fade back up. The fourth band, H4 and L4, is the breakout line: a decisive push through H4 signals a trend day to the upside rather than a range, while a break below L4 signals a trend day down. The space between the inner levels is where mean-reverting, range-bound price spends most of a quiet day, oscillating between the bands. The crucial read is which mode the day is in — if price respects H3 and L3, it is a range day to fade; if it blows through H4 or L4, it is a trend day to follow. The relationship of the open to the levels helps set the day's bias.
Best timeframes and settings
Camarilla is fundamentally an intraday tool: the standard practice is to compute the levels from the previous day's high, low, and close and then apply them to the current day's intraday chart, whether that is a five-minute, fifteen-minute, or hourly view. It is favored by day traders and scalpers who need precise, pre-defined reversal and breakout lines for the session. The multipliers are fixed by the system rather than adjustable parameters, so unlike a moving average there is little to tune — the main choice is which prior period defines the range, with the previous day being conventional, though weekly Camarilla levels exist for swing traders. Because the levels are anchored to a completed period, they do not repaint or lag; they are simply static lines. The trade-off is not responsiveness versus noise but rather how well yesterday's range predicts today's, which varies with the instrument and the market environment.
When and where to use it
Camarilla is at its best in ranging, non-trending sessions, where the mean-reversion trade at H3 and L3 has room to work, which is why its natural regime is ranging. It is well suited to liquid intraday markets — major stocks, index futures, and actively traded currencies — where the prior day's range is a meaningful guide to the current day. It is most useful in the first hours of the session, when the levels are freshest and price is discovering its range. It should be avoided, or flipped to breakout mode, on strong trend days driven by news or a gap, when price runs straight through the inner levels and the reversal trade fails. It is also less reliable after an unusually quiet or unusually wild prior day, when the range that scales the levels is unrepresentative. Matching the tactic to the day's character is the whole skill.
Strategies that use it
The textbook Camarilla strategy is mean-reversion at the third band: sell a rejection at H3 with a stop just above H4, targeting the opposite inner band or the prior close, and buy a bounce at L3 with a stop just below L4. The stop beyond the fourth band is essential — it is what keeps the reversion trade survivable when the day turns out to be a trend day. The complementary strategy is the breakout: if price pushes decisively through H4, abandon the fade and go long in the direction of the break, treating H4 as support, with the mirror image below L4. A third approach uses the open's position relative to the levels to set the day's bias, favoring longs if price opens and holds above the pivot area and shorts if it holds below. Combining the reversion and breakout modes into one plan, switching between them at the fourth band, is how experienced traders use the full system.
Combining it with other indicators
Camarilla levels give precise price locations but no timing or momentum, so they combine well with tools that supply those. A candlestick reversal signal such as a pin bar or engulfing pattern forming exactly at H3 or L3 gives the trigger the levels lack. An oscillator like RSI reaching overbought as price tests H3, or a divergence, strengthens the fade. Volume analysis helps distinguish a genuine breakout through H4 — which should come on expanding volume — from a false poke that will reverse. The standard floor-trader pivot or the day's VWAP can be overlaid to see whether Camarilla levels align with other widely watched references, and confluence between them makes a level more likely to hold. A higher-timeframe trend read tells you whether to favor the reversion trades or lean toward breakouts in the trend's direction.
Where it fails
The signature failure mode is the trend day: the H3 and L3 reversal trade fails badly when price blows straight through H4 or L4 and never looks back, which is precisely why the stop beyond the fourth band is non-negotiable. The tight inner levels also invite over-trading in choppy, indecisive conditions, where price chops across the bands and generates many small losing fades. Relying on Camarilla when the prior day's range was abnormal — a holiday, a gap, or a news spike — produces levels that poorly fit the current session. Treating the levels as magic lines that must hold, rather than as zones to watch for confirmation, leads to fighting strong moves. The remedies are to require a price or momentum trigger at the level rather than fading blindly, to always place the stop beyond the fourth band, to size small, and to switch to breakout mode the moment the fourth band gives way.
A worked example
Suppose a stock's prior day printed a high of 152.00, a low of 148.00, and a close of 150.00, giving a range of 4.00. The Camarilla levels for today are then H1 at about 150.37, H2 at about 150.73, H3 at 151.10 (150 plus 4 times 1.1 over 4), and H4 at 152.20 (150 plus 4 times 1.1 over 2), with L3 at 148.90 and L4 at 147.80 mirrored below. Early in a quiet session price rallies into H3 at 151.10 and prints a bearish reversal candle, so a trader fades it short near 151.05 with a stop just above H4 at 152.30 — risk of about 1.25 points — targeting the prior close at 150.00 and then L3 at 148.90. Price rolls over to 150.00 for a first target of 1.05 points and continues toward 148.90 for the full 2.15-point move, better than a 1.7-to-1 reward on the runner. Had price instead pushed through H4 at 152.20 on strong volume, the trader would have been stopped out small and flipped to buying the breakout, treating H4 as new support.