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What Price type is your fav?

Close
Total votes: 19 (63%)
Open
Total votes: 2 (7%)
High (No votes)
Low (No votes)
Median (High+Low)/2
Total votes: 6 (20%)
Typical (High+Low+Close)/3
Total votes: 2 (7%)
Weighted (No votes)
Average (H+L+O+C)/4 (No votes)
Trend Biased (No votes)
Heiken Ashi
Total votes: 1 (3%)
Total votes: 30

IdeaClose Price VS Median Price (or other price types)

1
Many of you use moving averages in your trading strategy, or some kind of indicator which is based on a moving average derived formula. But whatever type of MA you use: Simple, Exponential, Linear-weighted, Smoothed, or other, it is calculated on a base data which in MT4 at least, can be:

  • Close
  • Open
  • Low
  • High
  • Median -> (High+Low)/2
  • Typical -> (High+Low+Close)/3
  • Weighted (H + L + C +C) /4
  • Or other

All variations can be used for various types of strategies however the most used seems to be the CLOSE.

And this is my question; because the CLOSE looks only at the final price of a candle, while the MEDIAN calculates in the wicks too. One can say that the wicks are only noise, but ive also heard that the wicks can sometimes hint in the future price direction, so it could be a mistake to solely use the CLOSE.

Would be lovely if you guys chime in and give your thoughts on this.
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LikeRe: Close Price VS Median Price (or other price types)

2
Patrick K wrote: Tue Nov 03, 2020 4:04 am Would be lovely if you guys chime in and give your thoughts on this.
its good topic.............. welcome here man.............. CLOSE PRICE is what i use for analysis always............... wicks will wildly differ from broker 2 broker so not much point counting those................ keep ur choice to CLOSE price
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Re: Close Price VS Median Price (or other price types)

4
Deez wrote: Tue Nov 03, 2020 6:04 pm What Moey said but I will add not to forget about High and Low price which is also good for creating bands - and when price breaks these bands it normally means a move and that direction.
That's a good point, I didn't think of that! For Bands, this makes sense. So you're saying if the wicks break the bands, price will continue after a small retrace, right? :)
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Re: Close Price VS Median Price (or other price types)

6
Patrick K wrote: Tue Nov 03, 2020 4:04 am Would be lovely if you guys chime in and give your thoughts on this.
Excellent question.

Personally, the Best Price to Apply is the Closing Price. Why? For me, I trade both Spot FX and Futures. In Futures we always close our trades before the end of the day to avoid excessive holding fees. So the Close of the session is the end of our trades (and the end of our Candle). But not only that, the Close Price of the Daily timeframe factors in a whole lot of information (more on that below)!

Here's a fact, the Close price was considered by Charles Dow (Father of Dow Theory) as the most important price of the day and for several good reasons.

Charles Dow considered the Close price as the most important price to apply to technical analysis because it reflects:

  • The entire day’s sentiment (based on crowd psychology, economic releases (news/fundamentals), political stance and monetary developments)
  • For Price Action traders, it gives clues on what is anticipated to happen before the next session of the market opens (or for intraday traders, it reflects what is anticipated to happen on the next candle)

For trading Spot FX, the most important timeframe is the Daily timeframe and what happens at the end of the Daily timeframe's candle.

Like Moey explained, wicks vary from broker to broker, so only use the wicks if your scalping or looking for hints of continuation or reversals, just like in Deez's post above.

In Forex trading, chose the Close Price for trading.
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Re: Close Price VS Median Price (or other price types)

7
Jimmy wrote: Wed Nov 04, 2020 9:14 pm Excellent question.
Thank you for your in depth response, ill make sure to use the close price from now. So prices like WEIGHTED, TYPICAL, or HEIKEN ASHI are used to smooth/filter out market noise (thus loose the edge over the CLOSE price)?

Im new here, can I continue opening threads like this one when ive got questions again (got one regarding different HMA periods)?

Re: Close Price VS Median Price (or other price types)

8
Patrick K wrote: Wed Nov 04, 2020 11:07 pm Im new here, can I continue opening threads like this one when ive got questions again (got one regarding different HMA periods)?
Of course you may. The more topics, the better :)

Welcome to the site, too!
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Guide to the "All Averages" Filters (ADXvma, Laguerre etc.) 🆕
Use Fibonacci numbers for indicator settings + How to draw Fibonacci Extensions
An easy trick for drawing Support & Resistance

Re: Close Price VS Median Price (or other price types)

9
Jimmy,

In my trading I use some of the indicators on this site in my automated algo. Ive noticed issues with the current candle close price repainting (which is normal) and sometimes causing a false entry. So i switched my system to only use the Open price, as the open price never changes and is “close” to the previous candles closing price.

How do you navigate the current candles closing price “repainting? What are your thoughts?


Jimmy wrote: Wed Nov 04, 2020 9:14 pm
Excellent question.

Personally, the Best Price to Apply is the Closing Price. Why? For me, I trade both Spot FX and Futures. In Futures we always close our trades before the end of the day to avoid excessive holding fees. So the Close of the session is the end of our trades (and the end of our Candle). But not only that, the Close Price of the Daily timeframe factors in a whole lot of information (more on that below)!

Here's a fact, the Close price was considered by Charles Dow (Father of Dow Theory) as the most important price of the day and for several good reasons.

Charles Dow considered the Close price as the most important price to apply to technical analysis because it reflects:

  • The entire day’s sentiment (based on crowd psychology, economic releases (news/fundamentals), political stance and monetary developments)
  • For Price Action traders, it gives clues on what is anticipated to happen before the next session of the market opens (or for intraday traders, it reflects what is anticipated to happen on the next candle)

For trading Spot FX, the most important timeframe is the Daily timeframe and what happens at the end of the Daily timeframe's candle.

Like Moey explained, wicks vary from broker to broker, so only use the wicks if your scalping or looking for hints of continuation or reversals, just like in Deez's post above.

In Forex trading, chose the Close Price for trading.
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