Granthara04.01.04Close location within range: the single most useful candle metric

Every price in Part 04 comes from an unnamed vegetable market and is a teaching example. Nothing here is a quote, a recommendation, or a record of any listed company.

04.01.04 · Close location within range: the single most useful candle metric

PreviouslyCandle size is a comparison, never a measurement on its own.

One number. The whole taxonomy.

Lakshmi has four numbers and eleven years of boards. Asked which of the four she looks at first, she does not name one — she names a relationship between three of them, and it is the one thing on the board that the rest of this Part is built out of.

Where the last bid finished inside the day's range. Learn this and the list of names stops being a list.

Updated

83%
of the way up its range that Tuesday's session finished
Part 04 · Anatomy and Force
  1. 04.01.01 How to read a candlestick: the four numbers
  2. 04.01.02 Body vs wick: intent vs rejection
  3. 04.01.03 Range and relative candle size
  4. 04.01.04 Close location within range: the single most useful candle metric
  5. 04.01.05 Reading a candle as a story of the session
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Learn

The measurement

Take the lowest price, the highest price and the last price. Ask how far up the distance between the first two the third one sits.

Tuesday ran from ₹21.60 to ₹23.40 and finished at ₹23.10. That is ₹1.50 above the low, out of ₹1.80 of range: 83% of the way up. Written out, it is (last bid − lowest) ÷ (highest − lowest).

That is the whole arithmetic, and it is worth noticing what it uses. Three of the four numbers, and not the open. The first bid of the session plays no part in it at all.

See it

Drag the last bid, and watch the one number

The first bid, the highest and the lowest are fixed. Only the last bid moves — and with it, the only measurement this lesson cares about.

Thirds are a convenience for talking, not a boundary in the market. Nothing happens at 33% that does not happen at 34%.

Learn

Why this one and not the others

Each of the four numbers answers something. The open says where the period was cut. The high and the low say how far it travelled — that was 04.01.03.

Close location answers a different kind of question: of everywhere the session went, where did it stop? A session that reached ₹23.40 and finished at ₹23.10 ended up holding almost all of its own travel. The same session finishing at ₹21.90 would have given nearly all of it back.

It is also the measurement that survives comparison. Range is in rupees and cannot be compared across instruments; close location is a proportion, so 83% on onions and 83% on anything else mean the same thing. That is unusual on a chart and it is why the number travels so well.

Almost every name you will meet in this Part is a statement about where the close finished inside the range. Learn the number and the taxonomy stops being a list to memorise.

Learn

What it is not

It is not a claim about people. A close near the high is often described as buyers having the last word — a vivid description, and an interpretation that the board cannot confirm. There are no participants in four prices.

It is not a claim about the path. 83% says where the session stopped, not that it climbed there, not that it stayed there, not that it got there last. That is 04.01.05.

And it is not a claim about tomorrow. Lakshmi's line applies here as everywhere: her board tells you what happened today, and it has never once told her tomorrow's price.

What it is, is a checkable fact about three of the four numbers — which is more than most things said about a candle can manage.

One range, four endings
Range ₹21.60 to ₹23.40
₹1.80
Finished at ₹23.10
83% of the way up
Finished at ₹22.50
50% — the middle
Finished at ₹21.90
17% of the way up
What changed between those
one of the four numbers
83%Tuesday, as one proportion
3of the four numbers the measurement uses
Try it

A session ran from ₹40 to ₹50 and finished at ₹47. Drag to where the close sits in the range, as a percentage.

0%

Try it

Two sessions both finished 90% of the way up their range. The first had a range of ₹0.20, the second ₹3. What do they have in common?

The number, in one line(last bid − lowest) ÷ (highest − lowest). Three of the four numbers, expressed as a proportion, and the backbone of every chapter that follows.

One number, and four lessons of anatomy behind it. What remains is the temptation all of it has been building towards: telling the story of the session out loud.

Remember

Where the close sits between the low and the high — (close − low) ÷ (high − low) — is the most useful single fact about a candle, because it says where the session stopped out of everywhere it went, it uses three of the four numbers, and being a proportion it means the same thing on any instrument.

Everything this chapter has told you, in order

  1. 04.01.01Four numbers survive a whole session, and knowing what was rubbed out is most of the skill.
  2. 04.01.02A body is what was kept; a wick is what was visited and handed back.
  3. 04.01.03There is no such thing as a big candle — only a candle bigger than the ones beside it.
  4. 04.01.04Learn one number and the list of pattern names stops being a list to memorise.
Next
04.01.05 — Reading a candle as a story of the session

Next: the story the four numbers invite, and how much of it they can carry.