Reference Levels from Prior Sessions: High, Low, Close and Value

Before you read: Volume Profile Explained: POC, Value Area, HVN, LVN

ILLUSTRATIVE · Constructed for teaching · Not real market data · Not a recommendation or signal

What you will learn

• Which prices from earlier sessions traders commonly mark: prior high, low and close, prior point of control and value area, and the overnight range.
• How the data choices behind each level change its value.
• How to use reference levels as a map for describing a session, and why a level is a place to watch, not a place where something has to happen.

The levels come from lessons you have already read: support and resistance, volume profile and opening types.

What is a reference level?

Before the first trade of a session, which prices from yesterday would you write down, and why those?

A reference level is a price from an earlier period that a trader marks on the chart before a session starts, so that the new session can be described relative to it. “The market opened above the prior day’s high” is a sentence that only makes sense once that high is marked.

Reference levels are bookkeeping. They give you fixed points so that you can describe location, the same way street names let you describe where something happened in a city. They do not cause anything.

Which prior-session prices do traders mark?

Which single prices summarize the session that just ended?

The most common ones:

• Prior day high (PDH) and prior day low (PDL): the extremes of the previous session.
• Prior close: the last price of the previous session. For futures, many traders also mark the settlement price, which the exchange sets by its own procedure and which can differ from the last trade.
• Prior point of control: the price with the most volume (or most TPOs) in the previous session’s profile. A naked point of control is a prior point of control that no session since has traded through.
• Prior value area: the previous session’s value area high and value area low, usually on the 70% convention described in volume profile.
• Overnight high and low (ONH, ONL): for markets with an overnight session, the extremes of trading between the prior regular close and the new regular open.

Many traders also mark the high and low of the prior week or month, or the initial balance of the prior day. The more levels you add, the more care the next section needs.

Reference levels diagram

Illustrative diagram constructed for teaching. Not real market data.

The diagram shows a constructed prior session (high, low, close, point of control and value area), the overnight high and low, and the next session’s opening price placed among those levels, with each level labeled.

Why do data choices change the levels?

Two charts of the same contract show different “prior highs”. Can both be correct?

Yes. Each level depends on choices:

• Session window. For index futures, a regular-hours prior high and a full-session prior high are often different prices.
• Close or settlement. The last trade and the official settlement can differ.
• Contract and roll. A continuous contract splices months together. Around a roll, prior levels from the old month may sit at different prices from the same levels in the new month. See volume for how rolls work.
• Profile settings. A prior point of control and value area change with row size, data source and whether the profile counts volume or TPOs.

Write your choices down once and keep them fixed. A level that moves every time you change a setting is not much of a reference.

How do traders use reference levels descriptively?

How would you describe where a session opened, using only marked levels?

Here is a constructed illustration on a made-up scale:

• Prior session: high 102.00, low 98.00, close 101.10, point of control 100.25, value area 99.50 to 101.00.
• Overnight session: high 101.60, low 100.40.
• Regular session opens at 101.40.

A descriptive pre-open summary might read: “The open at 101.40 is above the prior value area high (101.00) and below the prior high (102.00). It is inside the overnight range. The prior point of control at 100.25 is naked: the overnight low of 100.40 sits above it.”

That paragraph locates the open. It does not say where price goes next. During and after the session you can add plain observations such as “price traded up to 102.00, printed there in two periods, and traded back below 101.80”. Each statement is checkable.

Opening types uses the same idea: an open is described relative to the prior value area and prior range.

Why can it look as if price always reacts to levels?

If you mark ten levels inside a 100-point range, how far can price ever be from one of them?

Here is the arithmetic. Suppose ten levels sit in the middle of each 10-point band of a 100-point range (at 5, 15, 25 and so on up to 95). Then price inside that range can never be more than 5 points from the nearest level. Wherever price turns, it turns “near a level”. Add weekly and monthly levels, round numbers and a few VWAPs, and almost every turn on a chart lines up with something.

That is why a chart full of reference levels can look convincing in hindsight. The honest question is not “did price turn near a level?” but “did price behave differently near these levels than it does at randomly chosen prices?” Answering that needs a fixed rule, a large sample and the out-of-sample discipline in honest backtesting. Testing many levels at once also raises the risk of finding a pattern by chance.

What are the limits of reference levels?

What does a line on the chart leave out?

• They are choices. Which levels you mark, and how, is a decision, not a fact about the market.
• Crowding. With enough levels, every price is near one.
• Data differences. Session window, settlement versus close, contract roll and profile settings all move the levels.
• No information about why. A level shows where something happened before, not who traded there or whether they are still present.
• Hindsight. Levels that “mattered” are easy to remember; levels price ignored are easy to forget.

What this does not tell you about reference levels

• A prior high, low or close is not a price where the market has to stop, turn or speed up.
• A naked point of control is not a price the market has to revisit.
• Opening inside or outside prior value describes location, not what follows.
• A level price respected once does not have to matter again.

Method in Practice: building the pre-session map

Fictional example. John, Harbor Index futures, the prices, times, costs and results are all invented for teaching. This shows how a written plan can be built and tested. It is not a recommendation, and nothing here says how often this idea works.

Try it on a real chart. Test this idea yourself on past sessions with bar replay. Keep your own count, including the days with no trade.

The idea. Before the open, John writes a short map: the levels he marks, one sentence about where the open sits, which plan is active and at which level, and where he won't trade. The map doesn't predict anything. It decides in advance what he's watching, so he isn't reacting to every line on the chart.

John's map (the lesson's constructed numbers)

Levels

prior high 102.00 · prior close 101.10 · prior value area 99.50–101.00 · prior POC 100.25 · overnight 100.40–101.60

Open

101.40, above prior value, below the prior high, inside the overnight range

Active plan

value re-entry from above. Enter short if two 30-minute closes in a row land below 101.00. Wrong if a 30-minute close goes back above 101.00. Take half at 100.25, the rest at 99.50 or by 14:30. $150 maximum.

No-trade zone

between 101.00 and 102.00 he has no plan, so he waits

Three outcomes

• ✅ Worked: accepted back into value → +$140

• ❌ Failed: back above 101.00 → −$84, inside the limit

• ⏸ No trade: price stayed in the no-trade zone → $0

Show the full replays

Item	Plan
Map	As above, written before 08:30 CT
Entry condition	Two 30-minute periods in a row close below 101.00. Sell 2 at market after the second close
Wrong if	A 30-minute period closes above 101.00 after entry. Exit at market after that close
Management	Take profit on half at 100.25 (limit) and move the exit for the rest to the entry price (stop). Rest at 99.50 (limit). Time limit 14:30 CT
Risk cap and size	$150. Exiting just above 101.00 is planned to cost about $35 per contract, so 2 contracts
Not trading if	Scheduled major release within the hour, or no setup by 12:00 CT

Replay A: worked

Time (CT)	What happened	John
08:30–09:00	Opens 101.40, falls, closes 100.95	First close below 101.00
09:00–09:30	Closes 100.80	Second close below: sells 2 at market, filled 100.75
09:30–10:50	Trades 100.25 at 10:50 (just under the overnight low, 100.40)	Buys back 1 at 100.25 (limit). Exit for the other moves to 100.75
10:50–14:30	Low 99.62, never 99.50, never back to 100.75	At 14:30 buys back the last 1 at market: price 99.70, filled 99.75

Result after costs: +0.50 point = +$50, +1.00 point = +$100, commissions −$10. Net +$140. Journal: "The map named the zone in advance. The second level missed by 0.12 and the time limit closed it."

Replay B: failed

Time (CT)	What happened	John
08:30–09:00	Closes 100.92	First close below
09:00–09:30	Closes 100.88	Second close below: sells 2 at market, filled 100.83
09:30–10:00	Bounces, closes 101.15	Wrong-if met: buys back 2 at market, filled 101.20
10:00–15:00	Trades up to the prior high, 102.00	Done for the idea

Result after costs: 2 × −0.37 point = −$74, commissions −$10. Net −$84. Journal: "Re-entry failed. The map said there was no plan above 101.00, so no new trade up there."

Replay C: no trade

Time (CT)	What happened	John
08:30–12:00	Closes 101.30, 101.05, 101.45, 101.25, 101.60, 101.35, 101.50: never below 101.00	In the no-trade zone all morning. 12:00 cutoff

Result: $0. Journal: "Price sat between my levels. The map told me in advance that this was a day to watch."

Test it yourself

• Write the map before the open for 20 sessions, and keep the same levels and settings.
• Afterwards, mark which levels price actually traded at, and which ones it ignored.
• Compare with randomly placed lines under the same rule (this lesson's "always near a level" arithmetic).

Where it breaks

• With enough levels, every price is near one. Fewer, fixed levels keep the map honest.
• Settlement versus last trade, and session windows, move the levels.
• Levels that sit close together (100.40 and 100.25 here) act as one zone, not two signals.

Reflection question: How many levels are on your chart right now, and which ones does your plan actually use?

Check yourself

Reflect on these; there is no score.

1. Prior value area 99.50 to 101.00, prior point of control 100.25, prior high 102.00. The market opens at 100.20. Describe the open’s location in one sentence. Hint: inside or outside value; above or below the point of control.
2. Why might your prior day high differ from a colleague’s on the same contract? Hint: session window, contract month, data source.
3. You mark 20 levels, one in the middle of each 5-point band of a 100-point range. What is the farthest a price inside the range can be from a level? Hint: with levels in the middle of each 5-point band, the spacing is 5 points; halve it.
4. What would you compare a level’s “reactions” against to check whether it is special? Hint: randomly chosen prices under the same rule.

Last reviewed November 8, 2026. Spotted a mistake? Report an error.