In this post, I will explain to you about the (OHLC) Open, high, low, and closing price of a share. So this is just a basic term that u need to understand while looking for technical analysis of stock and to understand different types of charts.
You know in India Market opens at 9:15 AM and closes at 15:30 PM during which there were many trades.
It will be practically impossible to track all these different price points. So the fact is one needs a summary of the trading action and not really the details on all the different price points.
By tracking the Open, high, low, and close we can draw a summary of the price action and how the stock is perfuming.
OHLC - OPEN HIGH LOW AND CLOSING
- O - The open is when the markets open for trading, the first price at which a trade executes is called the opening price.
- H - The high represents the highest price at which the stock was traded on the given day.
- L – The low represents the lowest level at which the stock was traded on the given day.
- C - The close represents the closing price and it is the most important price because it is the final price at which the market closed for a particular period of time.
The close serves as an indicator for the intraday strength. If the close is higher than the open, then it is considered a positive day else it is a negative day for the particular share.
The closing price also shows the market sentiment and serves as a reference point for the next day’s trading. For these reasons, the closing price is more important than the Open, High or Low prices.