The price on Futures markets is called OHLC price. It gives us 4 main information:
O = Open price
H = Highest price
L = Lowest price
C = Close price
- Every day begins with the Open price. It is logic that it is close to the yesterday's close, but it needn't to be the same price. As a matter of fact it is never the same price (depends on the traded asset).
- Throughout the day the price raises and falls. The highest price reached is called the High price. It can raise (but not fall down) all the day until the market is not closed.
- Low price (or Lowest) shows us the lowest price reached during the day. It can also reach even lower Lows until the market is not closed.
- Close price is the price agreed when the market closes. This price is the most important one and it can be often found on the first place in a table.
OHLC shows us the Opening price, the Highest and Lowest prices reached and the Closing price.
OHLC is not a price assigned just for one time period (e.g. one day). Traders who trade 1-hour time frame use 1-hour OHLC price. etc.
OHLC can be displayed in so-called candlestick chart:
Copyright © Picture made by Incredible Charts
The length of the candle shows us where the High and Low of the day was. The middle body of the candle consist of the Open and Close price. If the Close is higher than Open, the candle is green. If Close is lower than Open then the candle is highlighted as red.
Note: Various markets can be opened and closed at various times. It is very important that you find out the opening and closing hours of the market you want to trade. There is also a difference between the Open Auction (aka Open Outcry) and pure Electronic trading.