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I am trying to figure out the difference between a weekly and daily chart. I understand that a daily chart shows the daily values for a measure - in this case, I am looking at the RSI for the S&P 500. But what changes when you select a "weekly" chart? If I look at the RSI for July 7, 2014 on a daily chart, it is different than the RSI for July 7, 2014 on a weekly chart. What is explains the difference?
On a daily chart, the period is one day. On a weekly chart, the period is one week.
To determine one period on a weekly chart, it goes something like this: The opening on Monday morning and the close Friday afternoon is the open and close for one period on the weekly chart. The highest high and lowest low during the week represents the one high and one low for the one period on the weekly chart.
Can someone verify that this is correct? Hope this helps.
kidchicago? Kids in chicago probably need to spend a lot of time figuring this out.
As you can see, it refers to closes only.
To construct a single BAR on the weekly chart, you need the data points Kevo describes. But to construct the INDICATOR value, you would use JUST the close from each week.
Indicators vary on the data they use, depending on what it's inventor thought was relevant. Probably the majority are based on the close alone. But others use the high and low and sometimes the open and even volume as well.
Hope that helps.
Thanks markd for filling the gaps on RSI, which I left out.
You can see this on a chart for EA (check "full quote" on the chart workbench to see the open, high, low and last prices). The Friday daily close on 7/11 is 35.97, and so is the close for the weekly bar beginning 7/7. The Monday daily open on 7/14 is 36.35, as is the open for the weekly bar dated 7/14.
Lets look a little closer at what Sharptraders is saying and why his statement would be incorrect.
Sharptraders says that one period on a weekly chart is from Friday's close to next Friday's close. This means that for every Friday, the closing price is identical to the opening price for the next period. In other words, the open for every period is the same as the close for the previous period. This would mean that weekly charts could never gap up or gap down.
If you look at weekly charts they do gap up and gap down! This means that the open for a period is not the same as the close for the previous period. Therefore, the open is not Friday's close.