Collectible card · Common
Premium & discount
Split the current swing range in half. Above the 50% line is "premium" (expensive), below is "discount" (cheap).
Why it works
Professionals buy cheap and sell expensive inside the range. Buying at the top of a leg gives you a bad price, a wide stop and little room to the target.
How to use it
In an uptrend, look for buys in discount (below 50%). In a downtrend, look for sells in premium. Wait for price to come to you.
The typical mistake
Chasing: buying after a big green move, right at the top of the range.
FAQ
What is Premium / Discount in trading?
Split the current swing range in half. Above the 50% line is "premium" (expensive), below is "discount" (cheap).
How do you trade Premium / Discount?
In an uptrend, look for buys in discount (below 50%). In a downtrend, look for sells in premium. Wait for price to come to you.