Prior day high and low runs: why they work and when they do not
Posted: Mon Nov 02, 2026 8:08 am
Prior day high and low runs: why they work and when they do not
The previous day's high and low are among the most watched levels on a chart. Orders cluster just beyond them: breakout entries, stop losses, and take profits.
That makes them natural targets for runs. Price pushes through, triggers the cluster, grabs the liquidity, and often reverses once it is done. The classic pattern is a quick move a few pips beyond the level followed by a sharp return.
It does not always happen. Sometimes the break is real and price continues. The difference often depends on context: the time of day, the news calendar, the size of the move that created the level, and whether volume is behind the push.
A scalper might treat the first touch of the previous high during a quiet period as a likely run, and the same touch during a news release as a likely breakout.
A good exercise is marking every touch of the prior day extremes for a month and classifying the outcomes. The patterns that emerge tend to be more specific than the folklore.
A variant worth tracking is the prior week's high and low. The pattern is similar but slower, and the levels draw orders from traders working on longer timeframes. A touch of a weekly extreme during a busy session can behave quite differently from a touch of a daily one.
It also helps to distinguish between levels created in a trending move and levels created in a range. A high made at the end of a strong trend often fails to hold and gets taken out within days. A high made in a quiet range tends to attract more reversals when retested.
Keeping a simple log with columns for the level type, the time of touch, whether the break held, and the news context provides, within a couple of months, a surprisingly nuanced picture.
Which conditions make prior day extremes behave like magnets for stops, and which make them real barriers?
The previous day's high and low are among the most watched levels on a chart. Orders cluster just beyond them: breakout entries, stop losses, and take profits.
That makes them natural targets for runs. Price pushes through, triggers the cluster, grabs the liquidity, and often reverses once it is done. The classic pattern is a quick move a few pips beyond the level followed by a sharp return.
It does not always happen. Sometimes the break is real and price continues. The difference often depends on context: the time of day, the news calendar, the size of the move that created the level, and whether volume is behind the push.
A scalper might treat the first touch of the previous high during a quiet period as a likely run, and the same touch during a news release as a likely breakout.
A good exercise is marking every touch of the prior day extremes for a month and classifying the outcomes. The patterns that emerge tend to be more specific than the folklore.
A variant worth tracking is the prior week's high and low. The pattern is similar but slower, and the levels draw orders from traders working on longer timeframes. A touch of a weekly extreme during a busy session can behave quite differently from a touch of a daily one.
It also helps to distinguish between levels created in a trending move and levels created in a range. A high made at the end of a strong trend often fails to hold and gets taken out within days. A high made in a quiet range tends to attract more reversals when retested.
Keeping a simple log with columns for the level type, the time of touch, whether the break held, and the news context provides, within a couple of months, a surprisingly nuanced picture.
Which conditions make prior day extremes behave like magnets for stops, and which make them real barriers?