The Importance of the Closing Tick
Every day, there is a tug-of-war in the market.
The bulls pull one way, the bears pull the opposite way.
At the end of the day, there is a winner for that specific day. At the end of the week, there is a winner for that specific week.
And so on.
But what does this mean? What are the implications for the average trader? I’ll tell you…
The Closing Tick Is a Big Deal!
All other things being equal, the closing tick is more important than any other tick of the day.
This is because the closing tick has a finality that the other ticks don’t have. The closing tick tells you where the market finished the day. It tells you whether the bulls or the bears won that day’s tug-of-war.
No other intraday tick can provide you with that information.
Which is one reason it’s difficult to be an intraday trader. You just don’t get as much insight into the market as an end-of-day trader.
Here’s how I see it…
- Following intraday ticks is like looking through a microscope.
- Following closing ticks on a daily basis is like normal vision.
- Following closing ticks on a weekly and monthly basis is like looking through a telescope.
Turns out, normal vision is a good thing for a trader to have.
It’s a good balance between low-level detail and high-level trends.
Moral: Don’t get too hung up on intraday ticks. Focus on daily closing ticks instead.
Best regards always,
A.J. Brown
P.S. My entire option trading system is based on making end-of-day trades. This is why it’s possible to make profitable trades in less than 30 minutes a day. Click here to learn more.
Tags: bears, bulls, closing tick, end of day, intraday, option trading










Comments on The Importance of the Closing Tick »
RESPECTED SIR/MADAM
WHAT WILL BE HAPPENED ???
IF OPEN =CLOSE=OPEN=CLOSE=SAME PRICE.
WITH REGARDS
LALIT TUTY
Hi Lalit,
I think what you are describing is a market that is “marking time”. In other words, it’s being indecisive. They call that a doji. On those day’s it’s important to look at how high was the intra day high versus how low was the intra day low and how heavy the volume was. That can give some understanding around whether the next trading day will start with carryover momentum from the previous trading day.
Great question!