The opening price of the daily chart is very important for trading and investing. For this reason, many day traders are keeping track of the opening price of each trading day.
This indicator that we introduce here, "DailyOpen" for MT4, makes this task easier. The indicator displays the opening price of each candle on the daily chart in other time frames. Keep reading to find out how it works and to download it for free below.
In the example above, this indicator is used for the EuroDollar hourly chart. The opening price of the daily chart is displayed as a blue line. The time zone used to calculate the opening price can be changed via the parameter settings of the indicator.
Why the opening price is important:
Maybe not as influential as the opening price in the stock market, the opening price is also important in the FX market. The opening price is the market's first attempt to find a “fair price” and is closely watched by traders as a result.
Even if the market moves considerably, the limit price often returns to the opening price. The opening price is also used as a calculation point for pivot points and other technical indicators. Furthermore, the opening price will often become the resistance or support zone during a trending session.
Tips on how to use it:
1. The price may return to the opening price of the daily chart after a considerable price move has occurred. Contrarian traders may place their profit targets at the opening price.
It is a good idea to use this behavior to adopt a strategy of “placing contrarian buy/sell orders when the price movements of the day exceed the ATR and then target a move back at the opening price of the daily chart”. This is a good strategy for reversal/contrarian trading.
2. If the stop price is lower than the opening price of the day, which is useful for analyzing the price movement of the day, it can be said that the day is "strongly bullish" (and vice versa). In this way, it is good to analyze the momentum of the day using the opening price of the daily chart.
For example, if the limit price is higher than the opening price, it may be good to judge that “buy is strong” and refrain from selling orders. This is a trend-following usage compared to the No.1 method.
Download the "DailyOpen" MT4 indicator from the button below
Do you need help with installing this indicator into MT4 for Windows or Mac OS? Our guide HERE will help you.
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