What is a Session Price
The session price is the price of a stock over the entire trading session, which is a variable period of time.
BREAKING DOWN Session Price
The session price is also sometimes referred to as the final price at the close of the session. Daily price data for a trading instrument usually includes the opening price, the high price, the low price and closing price as well.
Since the session is not a standard unit of measurement, the term is usually quantified, or possesses a pretext, to indicate which session it is referring to. For instance, it can be stated as the opening session price or the range of the session price. A session price can indicate the price over a day, a week, a month or any other indicated time frame. One may also see it used in descriptive instances by saying the session price was volatile, or the session price remained stable throughout the trading period.
The session price can be used to establish areas where there is support or resistance. It can also be used to identify overreaching trends across the market.
When Are the Stock Trading Sessions
The New York Stock Exchange (NYSE) has standard trading hours, which are 9:30 a.m. to 4 p.m., EST. The first trade of the day sets the opening price and the final trade will set the closing price. There are after-hours trades that can be made, but they can only be executed through the Electronic Communication Networks (ECNs). These after hour trades are separated into two markets.
The pre-market trades take place between 4:00 a.m. and 9:30 a.m. The after-hours market trades take place from 4:00 p.m. to 8:00 p.m. These trades tend to have more volatility and less liquidity than the ones that take place during standard business hours. This is probably since trades that take place during these hours are considered unusual, and are potentially occurring due to outside factors and influences that may falsely inflate some prices.
There are many reasons why an investor may choose to trade outside of the standard operating hours of the NYSE. For some it may be the only time they have available. For others, there may be a market change that they are trying to get ahead of, or conversely, take advantage of. Whatever the reason may be, the market may revert to the prior day’s standard session prices, as opposed to the prices that were in effect during the alternative sessions, once the standard operating hours begin again.