A-pivot breakouts in EURUSDA-pivots (called A-UP and A-DOWN) are calculated using the opening range (OR - that is where price "belongs") often referred as Initial Balance ( IB ), in our case - monthly opening range. You can find the formula in Fisher´s book.
Red lines are opening range (the range of first 2 or 3 trading days in the beginning of month). Then one multiplies a specified distance (certain number of ticks above below OR) from opening range to get A-pivot level. I am not sure about the exact formula but ACD indicators do it automatically.
Opening range ACD strategy is usually applied to day trading but it is interesting to see how EURUSD reacts when those A-pivots are broken on monthly.
In relatively smooth downtrends price nearly always forms this peculiar bow-loop pattern, returning back to where it broke. Sometimes such bows or loops are formed twice a month.
This is not observed in strong trending market (you can flip back) but still even then price uses those levels as support - resistance.
The fact that price keeps returning back to monthly A-pivot means there is no strong trend yet.
GOOD LUCK!
