Home
Back
Distance = Price Difference:
| From: | To: |
Closing distance, or price difference, measures the absolute change between a stock's current price and its previous closing price. This metric helps traders and investors gauge daily price movements and volatility.
The calculator uses a simple formula:
Where:
Explanation: The absolute value ensures the distance is always positive, representing the magnitude of change regardless of direction.
Details: Calculating price differences helps identify volatility patterns, assess daily trading ranges, and make informed decisions about entry/exit points. It's particularly useful for gap trading strategies.
Tips: Enter both current price and previous close in USD. Values must be positive numbers. The calculator will compute the absolute difference between the two prices.
Q1: Why use absolute value in the calculation?
A: Absolute value ensures we measure the magnitude of change regardless of whether the price increased or decreased, providing a consistent measure of volatility.
Q2: How is this different from percentage change?
A: While percentage change shows relative movement, absolute difference shows the actual dollar amount change, which is important for position sizing and risk management.
Q3: When is this calculation most useful?
A: Particularly valuable at market open to measure gap sizes, and throughout the day to assess intraday volatility compared to the previous close.
Q4: Can this be used for other financial instruments?
A: Yes, this calculation works for any traded instrument including ETFs, options, futures, and cryptocurrencies.
Q5: How does this relate to support and resistance levels?
A: Large price differences from previous closes often indicate breakouts or breakdowns through key support/resistance levels.