Posted by forex at 2:43 AM
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1. Identify the highest and lowest price paid for a financial instrument for a given day's trading session. For example, IBM opens the trading day on the New York Stock Exchange at $122 and trades as high as $124 and and as low as $121.
2. Subtract the daily high from the daily low, or $124 minus $121, or $3.
3. Add the daily high to its daily low: $124 + $121 = $245.
4. Divide the difference ($3) by the sum ($245). Multiply this quotient by one hundred, or [(124 - 121) / (124 + 121)] X 100 = 1.22), or 1.2%.