Can someone please elaborate as to what significance the daily open and close price would mean?
And also is there further significance to the Monday closing price?
Curious as this is mentioned by many traders but i cant add the dots up as to why people monitor and talk about it.
thankyou
The daily open price is the price of which opened or started on that day. The daily close price is the price of which it closed on that day. On a 4h chart each candlestick represents 4 hours and the open and close of one candlestick represents the open and close of price that happened in 4 hours
Thanks I understand that, but why is so important to some traders in relation to price action?
It tells us what happened to the price in the past. It makes up a pattern which tells us if price is rising, falling or consolidating, which allows us to make an educated decision as to how we must set up our trades
The significance stems from the assumption that when price is trading above the open price, it will form a close up candlestick and vice versa. From a weekly perspective, For example, On monday, the daily candlestick closed up above Monday’s HIGH LOW mean level illustrating buying pressure. An assumption can be made to presumed the weekly candlestick will form a closed up candlestick as well, which may or may not be the case.
Henceforth, when price is trading above open price it can be taken as bullish bias and vice versa, Look only to go Long. Other factors such as weekly or monthly buying and selling pressure, monthly, weekly, daily average range, Currency strength meter, fundamental forecast … etc will also need to be taken into consideration to get the most accurate picture possible.
Hope this helps,
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Ps : Just a note, knowing all this is still far from adequate to help you in becoming a profitable trader. It is just a small piece of the jigzaw puzzle. There are simply too many style and strategy to digest out there. Ultimately, we must choose one style that fits our own risk appetite. All strategy works! success boils down to discipline in timely execution and probably money management.
Sometimes, daily close is important according the position of support/resistant levels.