NQ levels explained: prior-day high/low, overnight range and VWAP

How prior-day high and low, the overnight (Globex) range and VWAP are calculated for NQ futures, why traders watch them, and the common mistakes. Plain English, education only.

Why these three levels

Ask ten Nasdaq-100 futures (NQ) traders what they mark before the open and most lists will include the same three things: yesterday's high and low, the overnight range, and VWAP. None of them predicts anything on its own. They are popular because they are objective (anyone can compute them the same way), they summarize where business was done recently, and many participants watch them. This guide explains how each one is built, what it does and does not tell you, and the mistakes people make with them. For the broader pre-market routine, see how to read NQ key levels before the open.

Prior-day high and low

What it is. The highest and lowest traded price of the previous session. The first decision is which session. NQ trades nearly 23 hours a day, so there are two common definitions:

• Regular trading hours (RTH): the 9:30 a.m. to 4:00 p.m. New York cash-session window. Many traders use this because it is when the most volume trades.
• Full electronic session (ETH / Globex): the whole futures trading day, including the overnight hours.

Neither is "right", but mixing them is a common source of confusion. Pick one, label it on your chart, and use the same definition every day.

Why people watch it. The prior-day range shows where buyers and sellers were active yesterday. When today opens inside that range, traders often treat its edges as places where price may pause or reverse. When today opens outside it, the old edge is often watched as a reference: does price return into yesterday's range, or keep moving away?

Common mistakes. Treating the level as an exact line instead of a zone; ignoring that a level touched many times may matter less, not more; and forgetting that a gap open changes the context entirely.

The overnight range

What it is. The high and low traded between the previous day's close and the next cash open, often called the overnight high (ONH) and overnight low (ONL). Your platform's session template decides the exact start and end times, so check it rather than assuming.

Why people watch it. Overnight trading is usually thinner than the cash session. The overnight range shows where the market went while most participants were not active, and the cash open often tests whether that move is accepted. A narrow overnight range and a wide one describe very different mornings, which is why some traders compare the overnight range to a recent average range rather than reading it in isolation.

Common mistakes. Using a session template that includes part of the prior cash session (which silently changes the levels), and assuming that a break of the overnight high or low must continue. Sometimes it does; often it does not.

VWAP (volume-weighted average price)

What it is. The average price traded since a starting point, weighted by volume. For each bar, multiply a typical price by that bar's volume, add these up, and divide by total volume:

VWAP = sum of (price × volume) ÷ sum of volume

Because it is weighted by volume, prices where more contracts traded pull VWAP harder than prices with little activity. Most charting tools reset VWAP at the start of each session. As with the prior-day range, the session definition matters: a VWAP anchored at the overnight open and one anchored at the 9:30 a.m. cash open can sit at different prices.

Why people watch it. VWAP is often described as the "fair" average price for the day. Some execution desks measure their fills against it, so it gets attention. Traders commonly use it as a simple context check: is price trading above or below the session's average, and is it holding on that side?

Bands. Many platforms add standard-deviation bands around VWAP. They describe how far price has stretched from the average. They are not targets, and their width depends on the settings you choose.

Anchored VWAP. Instead of resetting each session, an anchored VWAP starts from an event you choose, such as a major high or low or a news release. It answers a slightly different question: what is the average price paid since that event?

Common mistakes. Reading VWAP early in the session, when only a few bars feed into it and it moves a lot; comparing VWAP values from tools that use different session settings; and treating a cross above or below VWAP as a signal on its own.

Putting them together

A simple way to use the three without overloading the chart:

1. Mark the prior-day high and low, and note which session definition you used.
2. Mark the overnight high and low.
3. Note where the market is opening relative to both ranges: inside, above or below.
4. Watch VWAP once the session has some volume behind it, as context for whether price is holding above or below the day's average.
5. Write down, before the open, what would make your idea wrong.

When two or more levels sit close together, traders often treat that area as more important simply because more people are watching it. That is a reason to pay attention, not a reason to act.

What these levels cannot do

These levels describe the past. They do not tell you which way price will go, how far it will move, or whether a trade will work. Thin overnight trading, data releases and gaps can make any of them irrelevant on a given day. Use them to organize your thinking and your risk, not to replace a tested plan. If you want to understand how a rules-based approach is checked before anyone relies on it, read what a backtest does and doesn't tell you.

Get the levels without building them yourself

The free Stacked Edge daily brief publishes NQ reference levels with their as-of date and says plainly when a level set is incomplete or old. It is a reference sheet for learning, not trade instructions.

Related reading

• NQ levels explained: prior-day high/low, overnight range and VWAP
• How to size micro futures (MNQ) for a small or funded account
• How to trade futures: contracts, micros, margin and orders
• Position sizing and the calculator

Education only, not financial advice. Trading futures risks loss. Examples are illustrative. No results are shown or implied by this article. Stacked Edge is not a registered investment advisor or commodity trading advisor.