A phenomenon of Open v/s high low
When you are into the work of stock trading, you often hear the terms "bull" and "bear". These terms are used to define market conditions. It is important to know and understand what the terms indicate, to understand the functioning of the market. Let’s understand what are bear and bull markets and which one is better Bear or Bull market. And then let's dig deeper into it.
The words Bull and Bear are used to describe whether the market is appreciating or depreciating. Sometimes, these terms are also used to determine how investors think about the market and the subsequent trends.
In simple words, when the stock market rises high, it is said to be a bullish or bull market. It is characterized by a continual increase in market share prices. When the market is bullish, most investors often believe that the uptrend will remain for a longer period.
On the other hand, the market is said to be bearish, when it is facing a downfall. A bear market is an indication of decline. In Bear Market, the share prices start dropping, and the economy of the country slows down.
Both bear and bull markets have different impacts on your investments. When the market is bullish, short-term or intra-day trading takes a peek. On the other hand, the bear market brings long-term investment opportunities to investors. So it's a good idea to spend some time to govern the market and make investment decisions accordingly.
The opening price is significant especially at the beginning of the market, to determine day trading strategies. The price at which the stock first trades on a trading day is known as the opening price. Open vs high-low generally gives you the first impression of how a stock will perform throughout that trading day. Hence, the effect of news, and events reflects on the opening price, at times leading to the opening of stock in a gap up or gap down.
When this opening price is compared with High or low, it helps the trader to take an effective position in the market. Therefore, a specific feature where High prices can be compared with low prices, would be beneficial for the trader.
Open vs High low can be understood into two sections, to generate Buy & Sell signal:-
This indicates a Bearish trend as prices will probably move below high prices. In other words, a trader can go Short. Whereas the Previous high will help a trader to identify a breakout by comparing it with the current day's high price.
This indicates a Bullish trend, thus a trader can go long. Here prices will possibly move upward beyond low prices. However, the previous low can help in determining the breakouts.
We have thus developed an open v/s high-low feature for traders to identify intra-day trading strategies and even the '%chg' option plays an important role for intra-day traders. This feature in Truedata Cheetah is shaped in such a way that a trader can certainly take a position by just observing the results.
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TrueData Team