The previous day's high and low — often written PDH and PDL — are among the most-watched levels in intraday trading. They mark the extremes of the last session, so a huge number of traders and orders reference them, which is exactly why price so often reacts there.
Two ways price reacts
At these levels price tends to do one of two things: reject and reverse, or break and run. A rejection back into yesterday's range suggests the level is holding; a clean break beyond it suggests the market wants to extend the range in that direction. Reading which is happening is the skill.
Using the levels
Some traders fade a first test of the PDH or PDL, entering on signs of rejection with a stop just beyond the level. Others wait for a confirmed break and trade the continuation. Either way the level itself gives you a clean, logical place to put your stop, which is what makes PDH and PDL so useful.
- Mark PDH and PDL before the session starts.
- Rejection back inside the range → the level is holding.
- A decisive break → the range may extend that way.
- The level offers a natural, tight place for the stop.
Yesterday's high and low are shared reference points — price either rejects them or breaks them, and both tell you something.