DEFINITION of 'Opening Range'

The highest and lowest prices of a security during the first few minutes of daily trading activity. Opening ranges are important to technical analysts and day traders, because they base their trading decisions not on the fundamental aspects of a stock, such as its price to earnings ratio and the strength of the company's market position, but on the movements of a stock's price and the volume in which a stock is traded.

BREAKING DOWN 'Opening Range'

Opening ranges can indicate how the market will perform for the day, as a whole. Day traders may base their trading decisions for the rest of the day on how current prices relate to opening range prices. Some technical analysts look for opening range breakouts to inform their trading decisions.

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