How to Read US Pre-Market and After-Hours Stock Charts

Extended-hours charts need their own reading

When the pre-market and after-hours sessions are open is a question of timing; this guide is about how to read the charts drawn during those sessions. A candle in extended hours can look exactly like a regular-session candle and still carry far less weight. In the regular session a price is the result of countless orders meeting, while in extended hours a single candle can be built from just a handful of trades. So even a candle of the same length is safer read as 'someone traded at this price', not as the market's consensus.

Check the volume first

The first thing to look at on an extended-hours chart is volume, not price. A long candle with almost no volume behind it means little. Going through these steps helps you avoid overreacting.

• Compare extended-hours volume so far with a normal day's regular-session volume
• Check whether a big candle came with real volume or from a few trades
• See whether there was news likely to draw trading, such as earnings or a filing
• Look at whether other stocks in the same industry moved in extended hours too

Last trade price and the spread

The price on a chart is the last traded price. When trades are rare, as in extended hours, that price can be fairly old and may differ from what you could actually buy or sell at now. The gap between bid and ask is also wider than in the regular session, so ordering off the chart price alone can get you filled somewhere unexpected or not filled at all. When watching an extended-hours chart, it helps to keep the order book open as well and see where the bid and ask sit and how much size is stacked at each level.

Three reference levels

Setting reference levels in advance makes extended-hours prices less unsettling to interpret. These three are the most widely used.

• The previous regular-session close: extended-hours percentage changes are usually measured from it
• Today's extended-hours high and low: watch whether the regular session breaks out of this range
• The previous regular session's high and low: see whether extended-hours prices sit inside or outside it
• Turn on extended hours in your chart settings to see these levels together

How it connects to the regular session

When the regular session opens, trading floods in and the price gets set again. On some days a gain made in extended hours holds after the open; on others it fades quickly. Since you cannot know which in advance, it works better as a yardstick for checking what actually happens after the open than as a forecast. For example, watch whether the price moves past the extended-hours high or low after the open, and whether volume picks up when it does. Keep in mind too that the regular open can differ from the last extended-hours price.

Days with news and days without

On days when earnings or an important filing come out after the close or before the open, extended-hours trading is relatively active and the chart carries more information. It is also common for a stock to move sharply right after the release and then change direction again as management comments or more news arrive. On quiet days, by contrast, small extended-hours moves are mostly noise from thin trading. Knowing what was on a stock's calendar that day before you look at the chart makes reading it much calmer. Companies often announce their earnings dates in advance, so noting them for the stocks you follow means a big extended-hours candle will not catch you off guard.

Check it with this site's live tools

The buy and sell signals tool and the large-cap scanner calculate indicators on daily candles, which makes them suited to seeing the bigger picture away from short extended-hours swings. The world markets overview shows right away whether the US regular session is open. Prices in these tools come from a data provider and may be delayed, and the way they handle extended-hours prices may differ from your broker's screen, so check your broker's quotes and order book before placing an order.

Things to keep in mind

This guide explains how to read extended-hours charts and is not investment advice. Extended-hours trading can be volatile and orders may not fill, and the available hours and order types vary by broker and can change. Check your broker's official information before trading. Investment decisions and their outcomes are your own responsibility.