Trader's Glossary

Premium / Discount

Above 50% of a dealing range = premium (sell zone). Below 50% = discount (buy zone). Calculated using a Fib retracement.

Premium and Discount refer to where price sits within a defined dealing range. Above the 50% mark = premium = expensive = ideal sell zone. Below 50% = discount = cheap = ideal buy zone. Smart money operates by selling premium and buying discount — never the reverse.

The Fibonacci retracement tool gives you premium/discount instantly: 0.5 is the equilibrium line. Combine premium/discount logic with order blocks: a bearish OB in the premium zone is THE highest-probability short entry. Same with a bullish OB in the discount zone for longs.