PPS Technical Indicator aka Person’s Pivots
The Person’s Pivot Study indicator on ThinkorSwim is without a doubt my favorite of all the indicators. It’s easy, it’s effective, and oh, did I mention it’s easy…
The PPS study was designed and developed by a man named John Person’s. A 32 year veteran of the Futures and Options markets, he’s been just about everything from a floor trader to a broker and even an analyst, but I’ll stop there and leave the history lessons for someone better suited to it. Whether he’s a financial genius or the guy serving fries at McDonald’s, it really makes no difference to us.
The Person’s Pivot study is a bullish and bearish momentum indicator. The study via thinkorswim (I can’t comment on other platforms) comes packaged with two moving averages, one fast and one slow that help determine a buying or a selling signal. Don’t know what moving averages are? Take a look at my moving averages page.
Interestingly, there isn’t a clear cut explanation for what triggers a buy or sell signal via the indicator. Mr. Person’s has decided to keep that to himself I suppose, but from what I can determine;
A signal is produced on these conditions;
Bullish
- Trend condition changes from bearish to bullish.
- New higher high, new higher low, new higher open, and new higher close.
- Close above a past high.
Bearish
- Trend condition changes from bullish to bearish.
- New lower high, new lower low, new lower open, new lower close.
- Close below a past low.
If anyone has more information about the construction of this indicator please share in the comments for everyone. I for one am interested to hear about it.
…
Whatever determines a bullish or bearish signal, it works… so I use it! Take a look at the screen shot below, then test it on your own charts to see how effective it really is.
I think you’ll find that of all the technical indicators out there, none is more straightforward and clear in its instruction. An up arrow means the market will move higher, and a down arrow means the market’s heading lower, that’s it. How’s that for simplicity?
Check it out and let me know what you think…
Click to Enlarge.
Technical Analysis
28 Comments
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Hi
Thanks for the details. But the up/down arrow do they appear at a point of time in advance to indicate bullish/bearish trend?
Thanks
Yes and no. I don’t like to use it for intraday trading because the indication will come and go with price movements. I prefer PPS for swing trading or as an additional indicator on longer term trades.
God bless,
Jeff
Thank you for the explanation, will definitely try this one out.
The indicator works very well for entries as long as you use it after the price bar has closed. Also, I don’t like to use it for over extended bars.
Hi,
In the Think or Swim PPS scan study, the following option is present: IsNan(“value” = PPS().buysignal) is true.
Do you have any idea as to the difference between true or false, as it will return two different sets of stocks. In looking at the the charts it’s not clear which will find the better investment options.
Thanks,
Larry
Hi Larry, thank you for reaching out. It is odd to me that a false setting would return a different signal. I will look into this code more when I can and share any findings. Let us know if you uncover anything as well.
God bless,
Jeff
Has anyone figured out a way to make a sound/alert for this indicator – Ive been using it for a while and I like it – just wish I could get it to sound off with the arrows. The normal alerts settings in TOS do not allow this indicator to be used because it is proprietary so someone would need to custom code it in. Anyone know if its for sale somewhere ?
Hi Will,
That’s a great idea but I haven’t come across that in my own research. Will keep my eyes out.
God bless,
Jeff
Will,
If you can’t get it to work directly, “plot” your own Arrow with a condition of PPS().BuySignal[1]==true. Then “Alert” of your own arrow.
Thank you WebRup!
in TOS you can create a strategy,
and paste this code
input ArrowsOn = yes;
input TracerLinesOn = no;
input PriceColorOn = no;
AddLabel(PriceColorOn, “PPS PriceColorOn”);
input ShowTodayOnly = no;
input ShowExtraDays = 0;
def Today =
if !ShowTodayOnly then 1 else
if GetDay() + ShowExtraDays >= GetLastDay() && GetYear() == GetLastYear() then 1 else 0;
input ArrowSpace = .233;
def space = Average(high – low) * ArrowSpace;
def BuyIt = PPS().buysignal;
def SellIt = PPS().sellsignal;
plot ppsBuy = if !Today or !ArrowsOn then Double.NaN else BuyIt – space;
ppsBuy.SetPaintingStrategy(PaintingStrategy.ARROW_UP);
ppsBuy.SetDefaultColor(Color.WHITE);
ppsBuy.SetLineWeight(3);
Alert(ppsBuy, “PPS Buy Signal”, Alert.BAR, Sound.Ring);
plot ppsSell = if !Today or !ArrowsOn then Double.NaN else SellIt + space;
ppsSell.SetPaintingStrategy(PaintingStrategy.ARROW_DOWN);
ppsSell.SetDefaultColor(Color.WHITE);
ppsSell.SetLineWeight(3);
Alert(ppsSell, “PPS Sell Signal”, Alert.BAR, Sound.Ring);
cap, THANK YOU for that TREMENDOUS piece of code!
I have been using it for over a week, and am loving the Ring alerts!
For those of you who would like to try it, but don’t know how to ‘paste’ it, here’s how I did it:
1. first, copy cap’s code by highlighting it (clicking and dragging over it), then doing a Ctrl-C
2. log into tos, then click on Charts
3. set up a chart that you would like to add this code to
4. click on the ‘Beaker’ (Edit Studies) icon
5. click on the Studies tab, then on Create…
6. name the new study by overwriting the default name NewStudyx
7. click into the black box after the line ‘plot Date = close;’, then do a carriage return
8. paste cap’s code by doing a Ctrl-P
9. click OK
There, you have copied cap’s PPS alert study!
You can add it to your chart like you would any other study:
1. scroll down the list of Studies to find it
2. click on it
3. click Add selected
4. click OK
Hope that helps others who would like to apply the Ring alert to the existing PPS study. It is really helping me; thanks again cap!
Thank you both!
God bless,
Jeff
Do you happen to know where I can find a TradingView version of this indicator?
Also, out of curiosity, when I was looking at the images, I noticed that the signal was given for some candles when it closed above/below the EMAs and then for other candles it appears on the next candle. What causes this change?
Without further research my assumption is the signal is contingent on a specific number of previous periods. Once the current price falls below, or moves above, the signal is generated.
God bless,
Jeff
Dilraaj, I’m sorry I do not. My experience with trading view is limited to some occasional cryptocurrency charting.
Jeff
im also interested to find this indicator for Tradingview
I’m sorry Dilraaj, I’m not sure about Tradingview. My first thought would be to Google if someone had potentially created and shared a free version of the indicator. Hope it helps.
God bless,
Jeff
Dilraaj Gill, I think I might be able to answer your question. The PPS indicator is based on Person’s Pivots, which is John Person’s version of Pivot Point Analysis (Pivot Points in ToS). The two averages are the average of the pivot points. The arrows are generated by the crossing of the two averages. I hope this helps understand what the indicator is indicating.
Actually I meant to say that one of the averages is the pivot point and the other is a 3 period moving average of the pivot point. This might help you program your own indicator in ToS so you can enable sounds, alerts, etc.
Thank you JP!
Any suggestion on how to identify the right PPS arrow to trade on. Some of them doesnt move the stock/index, while other times the trend is big.
Hi Suraj, unfortunately that is the nature of technical indicators. They can signal a large or a small move. I’m not suggesting you do this, but I look to enter a position when the indicator suggests it then focus on managing the trade appropriately. Hope that helps.
God bless,
Jeff
I pulled up PersonsPivot on my TOS and it looks totally different
I think you may be looking at “Persons Pivots” instead of the “PPS” study. Without looking into it I believe the “Persons Pivots” is a variation of the “Pivot Points” study where as the “PPS” is a bullish or bearish indicator. Hope it helps.
God bless,
Jeff
So looking at TOS, I see 2 studies, PPS and Persons Pivots, which look radically different. When I applied the PPS, it looked like a lot of other trend following strategies, such as MA crossovers, with some really nice long moves, and a decent number of whipsaws. What makes this superior? I love you content, and appreciate any response from you, or any of your followers who are smarter than I!
Thanks!
Tom
Hi Tom, i like the PPS study for its simplicity. With so many indicators requiring interpretation the PPS just highlights an arrow up for bullish and down for bearish. It isn’t perfect of course but it does keep things clear.
God bless,
Jeff