Central Pivot Range

CPR Trading Guide  •  A Price Action Post

Reading the Market's Range: CPR for Intraday Options & Long-Term Investing

How yesterday's high, low, and close become today's map — the Central Pivot Range framework used for intraday options and for building long-term equity positions in the Indian market, including the price-action method popularised by Gomathi Shankar.

The CPR band (gold) with R1–R3 resistance (green) and S1–S3 support (red) plotted against a trending price series

I. What CPR Actually Measures

Unlike a classic single-point pivot, CPR plots a range — three levels derived from the prior session — so a trader can see market balance at a glance, before the first candle of the day even forms.

The width of that range tells you as much as the levels themselves. A narrow range means the previous session found consensus quickly and today is primed to move. A wide range means participants disagreed all day, and today will likely chop sideways inside it.

Pivot (P)(High + Low + Close) / 3

Bottom Central Pivot (BC)(High + Low) / 2

Top Central Pivot (TC)(P − BC) + P

Resistance 1 / Support 12P−Low / 2P−High

Resistance 2 / Support 2P+(H−L) / P−(H−L)

Resistance 3 / Support 3H+2(P−L) / L−2(H−P)

II. Calculating CPR by Hand — A Worked Example

Say the Nifty's previous session printed High 24,350 · Low 24,100 · Close 24,250. Here is what today's CPR looks like, laid out from resistance down to support:

R3	24,616.7
R2	24,483.3
R1	24,366.7
TC	24,241.7
BC	24,225.0
S1	24,116.7
S2	23,983.3
S3	23,866.7

The CPR here (BC 24,225 to TC 24,241.7) is only about 17 points wide on an index trading near 24,200 — a narrow CPR, so today is a candidate for a trending, directional session rather than a choppy one.

III. The Six CPR Types, and What Each One Means

Before acting on any CPR level, classify today's range against yesterday's. This single check does most of the work in deciding whether to expect a trend day or a range day.

• Narrow CPR — TC and BC sit very close together → high chance of a trending move today; favours directional option buying.
• Wide CPR — TC and BC spread far apart → expect a choppy, range-bound session; favours spreads over naked buying.
• Higher Value CPR — today's entire CPR sits above yesterday's → bullish handover; bias toward longs.
• Lower Value CPR — today's entire CPR sits below yesterday's → bearish handover; bias toward shorts.
• Unchanged CPR — today's CPR nearly overlaps yesterday's → indecision carried forward, often a sideways day.
• Outside Value CPR — today's CPR fully engulfs yesterday's → volatility expansion; often a potential trend reversal point.
• Inside Value CPR — today's CPR sits entirely inside yesterday's → volatility contraction, coiling before a breakout.

Narrow/Wide describes the range's size on its own. Higher/Lower/Unchanged/Outside/Inside describes how today's range sits relative to yesterday's. A narrow, higher-value CPR is one of the strongest bullish trend-day setups; a wide, unchanged CPR is a strong signal to stay out entirely.

IV. Step-by-Step: CPR for Intraday Options

This sequence follows the price-action approach popularised in India by Gomathi Shankar (CPR by KGS, Scalpers Trading Academy) — pure price structure, no Greeks or open interest required.

1	Read the CPR width, before the openPlot yesterday's CPR before 9:15 AM. Narrow CPR → expect a trending day, favouring directional option buying. Wide CPR → expect a range-bound day, favouring option-selling spreads.
2	Compare today's CPR to yesterday'sA higher-value CPR signals bullish bias; a lower-value CPR signals bearish bias. Overlapping or unchanged CPRs signal indecision.
3	Mark every level pre-marketPlot Pivot, TC, BC, and R1–R3 / S1–S3, along with the weekly and monthly CPR for broader context, before the first candle forms.
4	Let price declare its zoneSustained trade above TC → long-only bias. Sustained trade below BC → short-only bias. Price stuck inside the CPR band is a no-trade zone.
5	Wait for a candle close, not a touchDon't react to price merely poking through TC or BC. Wait for an hourly (or your chosen timeframe's) candle to close beyond the level — this filters out whipsaws inside the CPR zone.
6	Structure the options trade with defined riskOnce the close confirms direction, favour spreads — a bull put spread on a confirmed bullish close, a bear call spread on a confirmed bearish close. Size by margin required and return on capital.
7	Use R1/R2/R3 or S1/S2/S3 as your roadmapThese become logical booking and trailing points — shift your stop as each successive level is cleared and closed beyond.
8	Manage risk against the CPR itselfPlace your stop just inside the CPR band. If price re-enters the CPR after breaking out, treat the setup as failed and exit.

This is a pure price-action framework — no Greeks, no open interest reading required to generate the signal. If selling options against it, still track implied volatility and time decay separately when sizing the position.

V. Step-by-Step: CPR for Long-Term Investing

CPR is built for intraday structure, but the same logic extended to higher timeframes gives long-term investors a framework for entries and accumulation zones.

1	Switch to the monthly CPRInstead of the daily range, calculate CPR from the previous month's high, low, and close on the stock you're evaluating.
2	Flag narrow monthly CPRsA narrow monthly CPR suggests potential for a strong multi-month trend. Shortlist the stock for accumulation if fundamentals also support it.
3	Confirm structure over several sessionsPrice sustaining above the monthly TC across multiple sessions confirms a structural uptrend — favouring staggered buying rather than a single lump-sum entry.
4	Overlay fundamentalsCPR only reads price structure. Pair it with earnings growth, ROE, debt levels, sector positioning, and relative valuation before committing capital long-term.
5	Use monthly S1–S3 as accumulation zonesDuring corrections, monthly support levels are logical zones to add; resistance levels are logical zones to book partial profit — while holding the core position long-term.
6	Reassess every monthWatch whether the monthly range is widening (trend maturing) or staying narrow (trend intact), and adjust conviction accordingly.

VI. Intraday vs. Long-Term: A Side-by-Side View

Aspect	Intraday / Options	Long-Term / Positional
Timeframe used	Daily & weekly CPR	Monthly CPR
Trigger	Candle close beyond TC/BC	Sustained close above/below TC across sessions
Entry style	Single trade, same-day resolution	Staggered accumulation over weeks/months
Risk approach	Defined-risk spreads (bull put / bear call), stop just inside the CPR band	Position sizing & staggered entries at monthly S1–S3; core holding retained through minor corrections
What confirms conviction	Price structure alone (Greeks/IV tracked separately)	Price structure plus fundamentals (earnings, ROE, debt, valuation)
Failure signal	Price re-enters CPR after a breakout	Monthly range widens sharply or closes back inside prior month's CPR

CPR Trading Guide · Price Action Framework Educational content, not investment advice